“We are in the midst of the largest energy security crisis the world has ever faced –- and I believe this will reshape investment strategies globally, with parallels to the major changes the energy world witnessed after the oil shocks of the 1970s,” said IEA executive director Fatih Birol, AFP reported.
“We are already seeing intensified efforts by both producer and consumer countries to diversify trade routes and energy sources -– such as advancing new pipelines and other supply infrastructure, on the one hand, and turning more to domestically available resources, on the other,” he added in the World Energy Investment report by the energy agency of the Organization for Economic Co-operation and Development (OECD).
The IEA estimates that global energy investment will reach US$3.4 trillion (S$4.35 trillion) in 2026, slightly higher than the previous year, with around US$2.2 trillion devoted to power grids, storage, low-emission fuels, nuclear, renewables, energy efficiency and electrification.
Alongside this, around US$1.2 trillion is expected to be invested in oil, natural gas and coal.
It nevertheless expects oil investment to decline for the third straight year in 2026, falling below US$500 billion despite rising crude prices.
This is due to uncertainty over how long higher prices will last, project lead times, supply constraints and the tightening offshore rigs market, which are limiting short-term investment outside the Middle East.
MNA
