Our view on the market

The energy industry is in a period of profound and fundamental change as it continues to experience strong growth rates combined with new challenges and opportunities.

Traditionally viewed as a cyclical sector several factors suggest the high oil and gasprices we are witnessing today will be here to stay for the foreseeable future. Driving this trend is Indian and Chinese energy consumption where energy needs continue to grow at 4% – 6% per annum to keep pace with their economic development.

With US and Western European oil and gas reserves in decline the shift of focus has moved towards the east with Russia, Asia and the Middle East stepping up to meet the world’s insatiable growth for oil. This has led to a shift in the balance of power now favouring the national oil companies who possess over 75% of the world’s oil and gas reserves. The role of the international oil company has changed dramatically over the last 40 years and they have to transform the way they operate.

With long established business models shifting, western companies are looking towards alternative and clean sources of energy, driven by fears over security of supply and the high priority that their governments have placed on combating climate change.

The energy sector is expected to require over $20trn of investment by 2030 to meet demand but the constrained availability of people and equipment will drive up production costs and may even act as a brake on expansion.

3i brings deep understanding and experience to an industry which is complex and dynamic. Our track record proves this as we back people and businesses that are:

• Innovative and flexible – we back business models that stand out in a competitive environment and swiftly adapt to a fluid market;
• Mobile and scaleable – being able to work on an international level in today’s energy environment is crucial if a business is to deliver top percentile results; and
• Partnership forming – continue to meet the demands of traditional players while responding effectively to the needs of new operators.