War in Middle East Could Unleash $300B Oil Spending Spree

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https://sputnikglobe.com/20260511/war-in-middle-east-could-unleash-300b-oil-spending-spree-1124110101.html

The Middle East conflict may accelerate global oil production investment, Dmitry Kasatkin, managing partner at Kasatkin Consulting, tells Sputnik.

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But the impact on oilfield services will be mixed, he clarifies, “not simply growth driven by higher prices and increased investment.”In the short term, the war on Iran disrupts regional operations—raising risks for workers, supply deliveries, insurance, and logistics. However, over the medium term, higher oil prices will likely encourage energy companies to spend more on drilling, maintenance, and production upgrades.Most of the added investment—about $185 billion—will go to the Persian Gulf, the expert speculates, though other oil-producing regions could also benefit. Quick-payoff projects like US shale drilling, well touch-ups, hydraulic fracturing, and downhole equipment likely stand to gain the most.Yet higher demand doesn’t guarantee fatter profits. Contractors may see revenues rise, but costs for equipment, fuel, insurance, and debt could eat into their margins, says the pundit, adding that pressure on the oilfield services sector could slow production growth by 2026.

https://sputnikglobe.com/20260503/iraq-can-restore-oil-exports-in-one-week-after-strait-of-hormuz-reopens---oil-ministry-1124075940.html

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But the impact on oilfield services will be mixed, he clarifies, “not simply growth driven by higher prices and increased investment.”“We estimate that additional upstream investment linked to the conflict will total around $300 billion over the next five years, representing a 10% increase compared with the pre-conflict forecast,” he notes.In the short term, the war on Iran disrupts regional operations—raising risks for workers, supply deliveries, insurance, and logistics.However, over the medium term, higher oil prices will likely encourage energy companies to spend more on drilling, maintenance, and production upgrades.Most of the added investment—about $185 billion—will go to the Persian Gulf, the expert speculates, though other oil-producing regions could also benefit.Quick-payoff projects like US shale drilling, well touch-ups, hydraulic fracturing, and downhole equipment likely stand to gain the most.Yet higher demand doesn’t guarantee fatter profits. Contractors may see revenues rise, but costs for equipment, fuel, insurance, and debt could eat into their margins, says the pundit, adding that pressure on the oilfield services sector could slow production growth by 2026.WorldIraq Can Restore Oil Exports in One Week After Strait of Hormuz Reopens - Oil Ministry3 May, 08:42 GMT

But the impact on oilfield services will be mixed, he clarifies, “not simply growth driven by higher prices and increased investment.”

Source: Sputnik News - World News, Breaking News & Top Storie