Norway's official statistics organisation, Statistics Norway, has predicted that oil prices are set to remain low and only gradually increase to around US$60 in 2018.
The organization said yesterday that low spending will also result in a drop in investment of almost 33% from 2013 to 2018.
The past year has seen the Norwegian economy experience an oil-driven economic downturn, due to the low oil prices, which has slowed investment.
But, Statistics Norway says high costs had already put a damper on new projects, before oil prices started to fall last summer.
"High cost growth meant that petroleum investments started to decline before the fall in oil prices, falling by 15% from the peak in Q3 2013 to Q2 2015," it says.
"The low oil prices mean that few potential new development projects are profitable, while investment projects related to existing fields can help to curb the fall in investment. As an annual average, we now assume that the investments will fall by almost 12% this year, and that the decline will gradually decrease in the years ahead to 5.5% in 2018. This implies a drop of almost 33% from 2013 to 2018."
Last week, the organization said invest in oil and gas projects in 2015 was expected to be down 15.1%. It also lowered its 2016 investment estimates to NOK181.2 billion - a 2% reduction on its previous 2016 estimate. However, expected investment for 2015 was increased by 1.5%, as a result of a number of exploration wells being brought forward into 2015, from 2016. But, overall 2015 investment is still expected to be 15.1% lower than spending in 2014.
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