October 2023 Monthly Floating Production Systems Report
Brent crude continues to trade near $90, providing a solid flow of cash to oil producers. And current prices could soon look cheap. Tensions in the Middle East have potential to send oil prices through the ceiling, with talk of oil spiking to $100+ if conflict spreads regionally. Longer term, recent developments clearly demonstrate the resilient role of fossil fuel as the primary energy source over the foreseeable future. ExxonMobil and Chevron have doubled down on commitment to oil and gas by acquiring Pioneer Natural Resources and Hess, respectively. Shell and BP’s strategic pivot back to the traditional oil and gas business reflects the reality that renewables are not the panacea for energy supply. Orders for production floaters remain strong. Two FPSOs were ordered during the month and around 35 floater projects are lined up for an investment decision within the next two years, provided supply chain tightness, financing access and/or environmental opposition do not delay or kill some projects.