Shell Oil CEO: World is going to need more oil

Shell Oil CEO Ben van Beurden on the impact of China's economic slowdown, Iran, the impact of declining oil prices and solar energy.

Shell CEO: The World Will Need More Oil

By Energy FOXBusiness

During an interview with FOX Business Network’s Maria Bartiromo, Royal Dutch Shell’s (RDS.A) CEO Ben van Beurden said the company is responding with “vigor and determination” to cope with lower oil prices.

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“We started off the slide in oil prices with a low gearing 12.4%. Since then, we have been cutting our operating costs, our capital spent quit considerably -- $4 billion OPEX, $7 billion capital costs -- that’s about a year of dividends that we have saved in a year’s time,” he said

Despite cutting costs, van Beurden says the dividend is safe.

“We did a very significant deal [BG Group acquisition] at a time of uncertainty in the markets. I think it’s very difficult for the ordinary investor to understand what is happening and what this deal means… I felt I needed to bring an assuring message out at as well -- that the dividend is basically guaranteed for this year at $1.88 per share,” he said.

He also discussed what the Iran nuke deal means for the global oil market.

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“It’s a little bit hard to predict for an outsider because we’ve been out of Iran for a long time, what will actually happen. A lot of talk about a million barrels of new oil coming on. But actually the world is going to need that million barrels. That’s the sort of, that’s less than 1 year demand growth and on top of it you see shrinkage in supply every year --  three to four million barrels a day of shrinkage in supply at $60 oil.”

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