We are pleased to launch the latest edition of our energy newsletter, which provides news, opinions and advice on risk and insurance topics affecting energy companies. We will be seeing oil and gas companies operating in higher risk emerging markets, such as Peru, Ghana, Côte D’Ivoire and Mauritania. Our main feature looks at the political and security risks, energy firms may be exposed to when entering these territories for the first time.
Main Features Covered In This Edition
For the first time in a number of quarter’s updates, we are seeing a real divergence in individual ‘energy’ sectors. In the recent past the same dynamic has applied to upstream, downstream, marine energy and casualty, being an oversupply of capacity.
According to PwC, upstream capital expenditure is now forecasted to rise by 6% year-on-year in the period to 2025, having dropped by 45% in 2014-2016. Exploration spending is also expected to rise by a 7% compound annual average growth rate in the near term, having collapsed by 60% in 2014-2016. Much of this spending will see oil and gas companies operating in higher risk emerging markets. Entering these territories for the first time can bring exposure to a range of political and security risks for energy firms, whilst risks can shift rapidly in existing countries of operation.
An overview of 2018 energy losses (physical damage and operator’s extra expense but excluding third party liabilities) of USD 10mm or more that we are aware of at the time of writing are as follows. We also show the total of all claims under USD 10mm (with a minimum claim USD 1mm) to give an overall total for the year so far.
With changes constantly taking place in the insurance market, we provide a short summary of the key market movers and people that have recently been in the news.
The energy market is constantly evolving to meet client needs; in this article we provide an update on new products and developments.
In this regular feature we take a look at common clauses found in energy insurance that are often not well understood and try to look at what their intentions are, and what they cover or exclude. In this article we look at ‘Policy Proof of Interest’ clauses.
For further information, please contact John Cooper, Managing Director in the energy division at JLT Specialty on +44 (0)203 394 0464.