Falih highlighted some of the industry's uncertainties and their disruptive effects on the flow of capital for new capacity. “Perhaps the greatest source of uncertainty in energy markets is price volatility,” said Al-Falih. He pointed out that oil prices during the past 20 months have ranged from close to $150 per barrel to below $35 and have recently rebounded to about $80. “These gyrations pushed many investors to the sidelines,” he said. “Reasonably stable and predictable prices are critical drivers for investments,” he added. “Prices should be adequate to encourage investments to expand supplies as well as offset the significant declines from ongoing production from both conventional and unconventional energy sources.” Other investment barriers cited by Al-Falih in the oil and gas sector are rising development costs, long cycle times for petroleum projects and the uncertainty of long-term projections for oil demand, said Al-Falih. “During these long development times, a host of key economic factors can change, impacting a project's profitability or even its viability.” In addition to oil pricing and financing issues, other IEF conference sessions focused on energy's role in human development, strategies for reconciling energy security and climate change, and ways to further strengthen global producer-consumer dialogue.
