Women in Energy
FTI Consulting's Claire Lawrie joined the Women in Energy webinar alongside energy experts Priscillah Mabelane, Maurice Radebe, Shaun Tooray Khwezi Tiya and Nthato Minyuku.
The panel debate revealed that globally, the energy sector has seen energy demand declining as lock- down occurred in many countries around the world. The WE Council global membership surveys highlight that 96% of energy business were already experiencing direct impacts and decreasing demand by end March, whilst trying to maintain services and manage reduced cash flows.
Focussing on South Africa, Claire Lawrie outlined how the country experienced three shocks at the same time, namely, COVID-19, a decline in the macroeconomy including sovereign rating downgrades and extreme low oil price. South Africa responded rapidly to COVID-19 with an immediate and strict lockdown. Claire Lawrie outlined how when oil prices dropped, coal and gas-toliquid operations was heavily impacted as their prices are pegged to oil. Storage became a restricted resource as demand dropped.
As a consequence, she noted, all energy companies in South Africa have been financially impacted by the loss in revenue.
Given all these developments, the level of uncertainty in the energy sector has exponentially increased. This includes a lack of clarity about the spread of the virus such as when and how quickly a vaccine can be developed and disseminated, levels of infection,government response measures and if countries and companies will collaborate, take a more diversified approach or implement protectionist measures. There is also uncertainty when it comes to the responses and resilience of the energy sector itself such as global value chain recovery times, demand patterns and prices.