Upstream spending slides, cost-cutting kicks in

The oil industry has tightened its belt several notches, getting better at extracting more oil for less money, says the IEA

Investment in the oil and gas sector fell by 26% to $0.65 trillion in 2016, partly thanks to less drilling as the low oil price hit investment—but also because upstream players have made big strides in cutting costs. In its World Energy Investment 2017 report, the International Energy Agency (IEA) also forecasts that upstream spending will rebound slightly in 2017, by 3% in real terms—a rise largely driven by a 53% increase in US shale investment and resilient spending in the Middle East and Russia. Evidence of an uptick in investment elsewhere is visible too. Wood Mackenzie reports that the number of upstream projects reaching final investment decision in 2017 could double to 25 compared wi