With global oil prices currently hovering in the sub $30/barrel level and the number of Covid-19 cases rising on a daily basis, companies are being forced to rethink ongoing project timelines and projects in the pipeline for 2020.

As operators scale back heavily on capital spending budgets and the short-term outlook for oil and gas looking particularly weak, the 2020 project outlook for Europe is concerning. The majority of projects awaiting final approval in the region this year are in the medium to high-risk category.

Breakeven prices and level of risk of European oil and gas projects due to take FID in 2020

Only projects that are extremely robust in a low oil price in the environment or are shielded from global oil price swings are likely to go ahead this year.

Projects under construction are at risk of timeline slowdowns and operational disruptions as European governments take stricter measures to control the spread of Covid-19. Consequently, Europe is predicted to see a multi-year low in upstream project FIDs for 2020.