Global Oil Industry Threatened

The Financial Times makes a grave case concerning the impact of the current pandemic: “It is no exaggeration to say the oil industry faces its gravest crisis of the past 100 years” (March 24, 2020). As many citizens of industrialized nations settle into life at home, travel by land, sea, and air has fallen drastically. Experts estimate that between 10 and 25 percent of global oil consumption could disappear in the coming months. This will have a big impact on an industry where supply and demand fluctuate wildly and dramatically.

As Russia and Saudi Arabia continue to produce oil at extremely high levels, their policies will only magnify the problem. Storage facilities are being filled with excess supply and supertankers are being forced into service as additional storage facilities. Global oil storage will reach capacity by summer. According to the report in the Financial Times, “Respite will come only once the most expensive oil production starts to shut down, or the weakest producers go bust…. If the short-term outlook for the industry is, frankly, a hellscape, the long-term outlook is arguably not that much better. The pandemic could leave a mark on already stuttering oil demand growth. International travel will take time to recover. Companies and employees who adapt successfully to working from home are likely to make it a bigger part of their future, keeping more cars off the road.” Economies that rely on oil revenues, including Nigeria and Iraq, will suffer greatly. And as the oil industry declines, so too will its subsidiaries, through a “trickle down” effect.

Prophecy declares a period ahead in which the world is turned upside down, old alliances and political configurations are reshaped, and once mighty superpowers are broken and humbled. While oil has provided a powerful path to wealth and influence in our modern world, there is no security for any world power, small or large, that does not recognize the sovereignty of the Almighty! To learn more about the reasons behind growing national and global problems and how these problems will be resolved, read or listen to “Nations Rise and Fall.”