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Rosneft CEO unveils two key factors behind global energy shortage

Igor Sechin also pointed to the dearth in geological exploration globally that is leading to oil and gas reserves failing to be replenished

BAKU, October 27. /TASS/. Shunning Russian hydrocarbons and cutting investment in energy have led to a worldwide shortage of energy resources and price hikes, Rosneft CEO Igor Sechin told the 15th Verona Eurasian Economic Forum in Baku on Thursday.

"The accumulated lack of investment, as well as the abandonment of Russian hydrocarbons have led to an acute shortage of energy resources and a surge in prices, unleashing an inflationary spiral around the world. Meanwhile, Europe’s leading energy companies, despite the energy crisis that has broken out in the region, continue to cut investments in the oil industry under pressure from climate policy," Sechin explained.

He also pointed to the dearth in geological exploration globally that is leading to oil and gas reserves failing to be replenished.

"Insufficient exploration volumes often no longer provide even their simple replenishment. According to Rystad Energy, by the beginning of 2022, global recoverable oil reserves and resources decreased by almost 9% year-on-year (by 152 billion barrels) to 1.572 trillion barrels. Only the development of 1.2 trillion barrels (76%) of them will be economically viable at an oil price of at least $50 per barrel. The decrease in global reserves estimates is due to a reduction of 120 billion of explored resources, mostly in the offshore sector of the US, the Rosneft CEO specified.