Crescent: "Gulf oil spill will put industry under scrutiny"

While no-one underestimates the Gulf of Mexico oil spill's impact upon the environment and the economy, many have wondered how the oil and gas industries will be affected in the coming years - will there be stricter regulations and will there be a backlash against fossil fuels?

Speaking to ArabianBusiness.com, Badr Jafar, executive director of UAE-based Crescent Petroleum, said he felt that the repercussions of the Gulf oil spill would "be felt within the industry globally for many years to come" and the "whole industry would be under greater scrutiny as a result."

Jafar also added that with the future of offshore drilling in doubt off the American coast, the Arabian Gulf region would play a central role in ensuring the global market remains well supplied.

Fallout from recent tragic events

"With the fallout from the oil spill in the US Gulf of Mexico, the Arabian Gulf region's central role is set to grow," he said.

"The recent tragic events in the Gulf of Mexico have given all participants in the energy industry, producers and consumers alike, cause for thought," he added.

"We at Crescent have no doubt that the repercussions of the spill for the industry are going to be felt for many years to come. One unquestionable outcome is that the whole oil and gas industry will now be under great scrutiny and will be held, justifiably, to the highest possible safety and environmental standards."

Despite deepwater drilling projects still continuing around the world, Jafar said such developments were likely to face much more regulation as well as the threat of reduced investment, especially as the aftermath of the Gulf of Mexico oil spill is expected to top $40 billion.

Jafar added that the fact that the Arab Gulf focused on onshore and shallow water production, meant it was 'safeguarded' from many of the problems facing deepwater drilling. However, he noted that more investment was to be needed to ensure such production was maintained.

"We believe the Arab Gulf's private sector will play a key role in contributing to the continued security of the global oil system," Jafar said.

"That is why we are actively investing in the oil and gas sector within and outside the region. The Gulf of Mexico incident has shocked the industry and the world; we will do our part in ensuring it does not lead to an economic shock as well."

Despite being underway for almost three months, the Gulf of Mexico oil spill has still not yet been capped. Clean-up operations have also been recently hampered with the start of the hurricane season and Hurricane Alex causing oil skimming operations to be suspended.

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