Global oil investments to be 20% less than 2014: IEA chief Fatih Birol

ISTANBUL: Low oil prices have triggered a record cut in exploration investment, which will put upwards pressure on global oil prices, the head of the International Energy Agency ( IEA) said at the G-20 energy ministers meeting in Istanbul, raising concerns for energy importers like India.

For India, which imports three-quarters of the oil it consumes, this would be bad news as the country has gained phenomenally after oil prices tumbled after June 2015, reducing the country's import bill, lowering the subsidy burden of sate-run refiners and higher tax revenue for the government as it raised duties instead of fully passing on the price cut to consumers.

"We expect this year, in 2015, global oil investments to be 20 per cent less than 2014," Birol told a news conference at a G20 Energy Ministers' meeting in Istanbul. This is the biggest decline in oil history," IEA Executive Director Fatih Birol told reporters in Istanbul.

"As a result of this, we expect that next year, US oil production will fall by 400,000 barrels per day because of projects not making economic sense … We may well seen soon upwards pressure in price," he said.

"I expect there will be adjustment of the market … Sooner or later we will see upwards pressure," he said.