Global energy investment set to slump by record $400bn in 2020
Global energy investment is expected to suffer its greatest annual fall on record this year due to the coronavirus crisis.
Investment is set to crash by $400bn (£325bn) — or 20 per cent — in 2020, according to the International Energy Agency (IEA).
At the start of the year, funding was on track for a two per cent increase — its biggest growth in six year. In 2019 global investment in the sector topped $1.8 trillion.
But the outbreak of Covid-19 and ensuing lockdown measures brought the global economy almost to a standstill, and energy firms have cut investment and shelved projects.
The biggest hit is expected to be in oil and gas investment, which is forecast to fall by almost a third.
The IEA warned that if investment stayed at 2020 levels it would reduce the level of global supply by almost 9m barrels per day in 2025.
And while the coronavirus lockdown has led to a temporary reduction in carbon emissions, the Paris-based energy body warned falling investment could harm the transition to clean energy in the aftermath of the pandemic.
“The historic plunge in global energy investment is deeply troubling for many reasons,” said IEA executive director Fatih Birol.
“It means lost jobs and economic opportunities today, as well as lost energy supply that we might well need tomorrow once the economy recovers.”
The IEA said revenue for industry and governments was likely to drop by $1 trillion this year due to the crashing demand and lower prices.