CEO of Abu Dhabi National Oil Company: The global energy industry needs to invest $4 trillion annually to meet AI demands

Sultan Al Jaber, CEO of the Abu Dhabi National Oil Company (Adnoc), stated that with the booming demand driven by data centers and artificial intelligence, the global energy industry requires up to $4 trillion in investment each year.

Al Jaber mentioned at a conference in Abu Dhabi on Monday that long-term demand growth will surpass short-term market concerns about an oversupply of oil. He believes that investors need to develop resources to drive the upcoming data boom, which includes upgrading the power grid.

This call for massive investment comes as most analysts warn of an oversupply of crude oil next year, further pressuring oil prices. So far this year, Brent crude prices have fallen nearly 13%, with geopolitical risks causing supply disruption threats preventing further declines in oil prices.

Al Jaber's views highlight the trade-off for energy producers between short-term market weakness and long-term structural demand growth. Just on Sunday, the OPEC+ oil-producing alliance stated that after a moderate increase in production in November and December this year, it will pause production increases in the first quarter of next year to address short-term market uncertainties.

Long-term Demand Outlook Overwhelms Short-term Market Weakness

Al Jaber stated, “The recent uncertainties are real, but long-term demand remains strong”:

“Our response to this demand should focus on data, rather than dramatic short-term fluctuations.”

According to his forecast, global daily oil demand will remain above 100 million barrels even after 2040. He believes that maintaining such a high level of demand requires additional investment from the industry.

Al Jaber explicitly attributed part of the enormous energy investment demand to the rise of AI and data centers. This emerging sector's massive consumption of electricity is becoming a new growth engine for global energy demand and poses challenges to traditional supply-demand models.

He specifically mentioned that to meet this demand, not only is it necessary to develop energy resources, but also to upgrade power infrastructure (such as the power grid). This indicates that the $4 trillion annual investment he is calling for is a large systemic project covering energy production, transportation, and electricity distribution.

Despite concerns about oversupply in the market, major oil-producing countries, including the UAE, are still increasing their production capacity. Sultan Al Jaber stated that the UAE is committed to playing a leading role in this round of energy investment.

He declared that the UAE is “open for business” and revealed that Adnoc's international business unit XRG is seeking more deals