Saudi Arabia’s energy minister Khalid al-Falih spoke at the Oil & Money Conference in London this week, where he offered a robust defense of OPEC’s 2014 decision to not intervene in the market to try to support oil prices. He also warned that future supply shortages could lead to a price spike. “Now consider if OPEC had cut production to maintain supply-demand balances. The effect would have been to encourage continued investments in expensive resources like shale, oil sands, deep sea and the Arctic, etc. This process would have continued,” al-Falih said , “with OPEC having to successively cut production year after year.” But, the crash in oil prices has created a new problem for oil markets. “Without investment,” al-Falih cautioned, decline rates will deepen, “to the point that many analysts are now sounding warning bells of future supply shortfalls.” Indeed, with new oil discoveries at a 70-year low, […]