Oil investments to drop 6% as IEA says demand is weakening

Oil investments to drop 6% as IEA says demand is weakening
Economic uncertainty is damaging outlook, holding down prices.
JUN 05, 2025
By  Bloomberg

by Nayla Razzouk

Global oil investments are expected to drop 6% in 2025, in the first such decline in a decade excluding the year of the Covid slump, according to the International Energy Agency.

“This decline in oil investment is driven by the economic uncertainties, the lower demand expectations, and lower prices,” IEA Executive Director Fatih Birol said in an interview as the agency published its annual World Energy Investment report. The drop is mostly the result of a “sharp decline in spending on US tight oil,” according to the report.

Crude prices have fallen as US President Donald Trump’s tariff policy threatens to slow the global economy, while OPEC+ accelerates the revival of its production into a market that was already well supplied.

The IEA’s initial estimates for 2025, based on company announcements, showed that oil and gas spending would be flat, but sentiment has since become more downbeat as oil prices are coming under pressure, according to the report.

Lower expenditure on oil brings IEA expectations for overall upstream oil and gas investment for 2025 to just under $570 billion, a decline of about 4%. Of this spending, about 40% goes toward slowing down production declines at existing fields. Global refinery investment in 2025 is set to fall to its lowest level in the past 10 years at around $30 billion. 

Spending in natural gas fields is set to maintain the levels seen in 2024, and investment in new liquefied natural gas facilities “is on a strong upward trajectory” as new projects in the US, Qatar, Canada and elsewhere prepare to come online. 

“Between 2026 and 2028, the global LNG market is set to experience its largest ever capacity growth,” according to the report. 

 

Copyright Bloomberg News

Latest News

UBS sees a net loss of 111 financial advisors in the Americas during the second quarter
UBS sees a net loss of 111 financial advisors in the Americas during the second quarter

Some in the industry say that more UBS financial advisors this year will be heading for the exits.

JPMorgan reopens fight with fintechs, crypto over fees for customer data
JPMorgan reopens fight with fintechs, crypto over fees for customer data

The Wall Street giant has blasted data middlemen as digital freeloaders, but tech firms and consumer advocates are pushing back.

The average retiree is facing $173K in health care costs, Fidelity says
The average retiree is facing $173K in health care costs, Fidelity says

Research reveals a 4% year-on-year increase in expenses that one in five Americans, including one-quarter of Gen Xers, say they have not planned for.

Advisor moves: NY-based Coastline wealth adds three teams with over $430M in assets
Advisor moves: NY-based Coastline wealth adds three teams with over $430M in assets

Raymond James also lured another ex-Edward Jones advisor in South Carolina, while LPL welcomed a mother-and-son team from Edward Jones and Thrivent.

Fintech bytes: Vestwell comes through for underserved savers with multilingual support
Fintech bytes: Vestwell comes through for underserved savers with multilingual support

MyVest and Vestmark have also unveiled strategic partnerships aimed at helping advisors and RIAs bring personalization to more clients.

SPONSORED How advisors can build for high-net-worth complexity

Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.