Industry

The IEA does not expect a recovery in supplies from the Gulf until next year. (Image source: Adobe Stock)

The IEA has once again revised down its oil demand and supply forecasts, as the stalemate in resolving the conflict in the Middle East and renewed attacks in both the Gulf and the Red Sea’s Bab el-Mandeb choke point continue to disrupt oil flows

World oil supply is now projected to average 100.7mn bpd in 2026, down 5.7mn bpd y-o-y, compared with the 4.3mn bpd forecast by the IEA a month ago, with a normalisation of supplies from Middle East producers now not expected until 2027.

Global oil production fell by 1.6mn bpd to 100.1mn bpd in August, as more than 10mn bpd of Gulf output remained shut in. Global oil stocks fell by 3.1mn bpd in August, leaving inventories at their lowest levels since 2023. Tanker costs were also up sharply, reflecting rising security risks and strong demand for ships.

OPEC+ crude production declined by 1.5mn bpd to 33.1mn bpd in August, as losses in Saudi Arabia and Iran outweighed a 980,000 bpd gain from Iraq. However output from some non-OPEC+ producers grew, particularly from the Americas.

Flows through the Strait of Hormuz averaged only 7.6mn bpd in August, 13.1mn bpd below pre-war levels, with cumulative export losses from the waterway approaching 2.8bn barrels.

Saudi Arabia hard hit

Saudi Arabia was particularly hard hit, seeing crude supply falling 2.3mn bpd to 6mn bpd in August, the lowest level in more than three decades, after Houthi-linked attacks on vessels and refineries, while Iran-backed militias in Iraq attacked the Abqaiq processing complex with drone strikes. Saudi Arabia has recently announced that the East-West pipeline has been shut as a precautionary measure, following drone attacks launched from Iraq. It is not known how long it will be until it is operational again. This could lead to a further squeeze on supply, given that the Kingdom had been able to reroute oil exports through the pipeline, which has a 7mn bpd capacity, to avoid the Strait of Hormuz.

Crude oil prices surged in September to their highest level since May, touching US$110 a barrel as hopes for a diplomatic solution to the crisis faded amid renewed attacks. After settling back slightly prices rose again following the attack on the Saudi East-West pipeline. Refined products prices have risen even more sharply, with fuels such as diesel reaching record highs, as both the Middle East conflict and Russia/Ukraine war damages oil refineries. Net diesel and gasoil exports from the Gulf and Russia were 1.6mn barrels a day lower in August than before the Middle East conflict.

Falling oil demand

Oil demand is also falling more than expected, partly ⁠due to sharp losses of petrochemical feedstocks and refined product supplies as well as record fuel prices, particularly for diesel, which are forcing consumers to cut their usage.

World oil demand will drop by 2.5mn bpd this year, the IEA predicted, more than its previous forecast of a 1.6mn bpd decline. (This is in contrast to OPEC, which still expects world oil demand to grow this year by 380,000 bpd). China has seen the biggest reduction, with oil imports, refinery activity and product deliveries significantly reduced. Demand reductions have also risen elsewhere, particularly in the Middle East as petrochemical operations and aviation have been impacted. With supplies still constrained, and commercial inventory buffers rapidly depleting, further demand reductions may be required in the coming months to close the gap, the IEA says.

Both the IEA and OPEC expect demand to rise next year; the IEA forecasts demand to rise by 2.6mn bpd in 2027 while OPEC forecasts a rise of 2.36mn bpd.

"Inventories have so far played a crucial role in balancing the market," the IEA said.

"With buffers shrinking and the global refining system stretched to the limit, the need for progress in resolving the conflict in the Middle East – and the Russia-Ukraine war, which is now in its fifth year – is greater than ever to avoid further market tightening."

The new standard represents an important step towards optical modem interoperability for subsea systems. (Image source: SWiG)

Oil and gas industry network Subsea Wireless Group (SWiG) has released a new industry specification for free-space optical communications, providing a common protocol for modems from different manufacturers

SWiGoptical Level 1 defines a simple protocol to satisfy interoperability and interchangeability requirements for subsea free-space optical communication devices. It supports applications including, but not limited to, process control, equipment and process monitoring, diagnostics and maintenance, and data exchange and harvesting across autonomous underwater vehicles (AUVs) and other connected subsea systems.

Systems working together

SWiG, a joint industry project (JIP) managed by OTM Networks (part of R&D consultancy Sagentia Innovation), was established to enable vehicles, infrastructure and equipment from different suppliers to work together seamlessly. It has 27 members representing all parts of the supply chain, from major energy operators to subsea service providers and integrators to specialist instrumentation companies. Its objectives include:

• Promote interoperability between users of subsea wireless communications.
• Raise industry awareness and acceptance of subsea wireless communications.
• Identify areas (within subsea wireless communications) where open standards are needed, and develop them.
• Encourage the integration of subsea wireless communication technologies.
• Share best practices across the industry.
• Promote knowledge transfer across the industry.

Shreekant Mehta, senior vice president, Energy Sector at Sagentia Innovation, said SWiGoptical Level 1 represents an important step towards optical modem interoperability for subsea systems.

“SWiG’s goal is to create a common subsea ecosystem where devices from different manufacturers interact seamlessly,” Mehta explained. “As subsea communication technologies continue to mature, a collaborative approach to developing open standards supports cost management and provides a common framework, reducing deployment risk, simplifying integration and supporting scalability. Achieving interoperability across subsea operations is essential if the industry is to realise the full benefits of autonomy.”

The new specification builds on the earlier SWiGacoustic standard and is the latest in a family of complementary SWiG standards that also cover radio frequency (RF), inductive data and power and hybrid communications. SWiGoptical Level 1 is now available to the wider industry, with Level 2 and Level 3 specifications for higher-performance protocols already under development.

Cooling is becoming one of the most critical elements of data centre performance. (image source: MSA Safety)

As AI workloads, cloud demand and rack densities increase, cooling is becoming one of the most critical elements of data centre performance, says MSA Safety

High-density computing environments generate more heat in a smaller footprint, driving greater use of advanced liquid cooling and other high-capacity thermal-management systems. These technologies can support demanding workloads, but they also reduce the margin for error.

In this environment, cooling resilience cannot begin at the point of failure. It must start earlier, with the ability to identify small changes before they develop into a wider operational issue.

The margin for cooling disruption is shrinking

Traditional data centres often benefited from a degree of thermal buffer. Lower rack densities and large volumes of conditioned air could provide teams with more time to respond when cooling performance began to decline.

High-density AI environments are different. Greater heat loads mean temperatures can rise more quickly if cooling capacity is reduced. A minor loss of performance that may once have developed gradually can now place equipment, uptime and service-level commitments at risk much sooner.

This changes the role of refrigerant leak detection. Rather than treating detection solely as a compliance or safety requirement, design and engineering teams increasingly need to consider it as part of the facility’s wider cooling-resilience strategy.

Cooling disruption can begin before an alarm

Refrigerant leaks are not always sudden or immediately visible. A small leak can develop gradually at a joint, valve, seal or other component, allowing the system’s refrigerant charge to decline over time.

Initially, the cooling system may compensate. Compressors may run for longer, controls may adjust and temperature set points may continue to be maintained. From an operational perspective, the system can appear to be functioning normally even though its performance has begun to change.

As refrigerant levels continue to fall, cooling equipment may work harder to maintain the required output. This can contribute to increased energy use, place additional strain on system components and gradually reduce the cooling capacity available to the facility. In a high-density environment, continued refrigerant loss may eventually lead to a low-pressure trip or an inability to meet the thermal load. By that point, the opportunity for planned intervention may have narrowed considerably.

The challenge is that detection systems intended primarily to identify higher refrigerant concentrations may not alert teams during the earliest stages of a leak. A critical alarm can confirm that action is required, but it may not provide the earliest opportunity to respond.

Early detection should begin at the design stage

Cooling resilience is strengthened when refrigerant detection is considered during system design rather than added late in the project. Design teams can identify likely leak points, plan suitable sampling locations and determine how detection information will connect with building-management or facility-monitoring systems. Aspirated sampling pipework can also be incorporated while plant layouts, service routes and access requirements are still being developed.

This early consideration is particularly important in large or complex cooling installations, where multiple pieces of equipment may need to be monitored across separate plant areas.

The location of sampling points can influence how quickly a developing leak is detected and how easily teams can identify its likely source.

During commissioning, high-sensitivity detection can provide another layer of visibility. It can help engineering teams identify low-level refrigerant presence, installation issues or emerging leaks before the cooling infrastructure is handed over to the operator.

Once the facility is live, the same system can support a more proactive maintenance strategy by showing where refrigerant is being detected and how readings are changing over time. This gives teams an opportunity to investigate while cooling equipment is still operating, rather than waiting for a fault, pressure trip or loss of capacity.

How aspirated refrigerant detection supports earlier visibility

Aspirated refrigerant detection continuously draws air from multiple sampling locations back to a central sensor for analysis. This allows several plant areas or potential leak points to be monitored from one system while still providing zone-specific information. Sampling points can be positioned close to chillers, compressors, valves and other areas where refrigerant leaks may develop.

The Bacharach® Multi-Zone gas monitor from MSA Safety uses infrared sensing technology to detect supported refrigerants at concentrations as low as 1 ppm. A single monitor can sequentially sample up to 16 zones, giving design, commissioning and maintenance teams greater visibility across complex cooling infrastructure.

This high-sensitivity approach can help identify low-level refrigerant presence before it develops into a more significant loss of charge. When detection information is connected to wider monitoring and alerting systems, teams can also review readings remotely, examine trends and prioritise investigation according to the location and development of an event.

The value is not simply in generating another alarm. It is in providing actionable information earlier in the progression of a leak.

Cooling resilience starts before failure

As computing densities rise, data centres have less tolerance for unnoticed cooling degradation. A critical alarm may indicate that cooling performance is already at risk. Early leak detection provides an opportunity to act sooner, while the system is still operating and before a low-level issue becomes a wider cooling disruption.

By integrating high-sensitivity refrigerant detection into design, commissioning and maintenance strategies, data centre teams can gain better visibility of emerging risk and take a more proactive approach to protecting cooling performance and uptime.

Explore how the Bacharach Multi-Zone gas monitor can support earlier refrigerant leak detection across critical data centre cooling infrastructure. Contact MSA Safety to discuss your application with a refrigerant-detection specialist.

*Bacharach is a trademark of MSA Technology, LLC, registered in the United States and other countries and regions.

Technip to deliver engineering services for ADNOC project.

Technip Energies has been selected by Larsen & Toubro Energy Hydrocarbon (LTEH) to deliver engineering services for a major ADNOC Offshore project in the United Arab Emirates

The project, recently awarded by ADNOC Offshore to a consortium led by LTEH, covers the engineering, procurement, construction, installation and commissioning (EPCIC) of new offshore facilities, together with modifications and upgrades to existing infrastructure.

The contract strengthens Technip Energies’ position in high-end engineering services, as it will draw on its strong local engineering capabilities and extensive experience with complex, large-scale offshore projects in the Middle East.

The award also builds on the long-standing collaboration between Technip Energies and Larsen & Toubro (L&T) across a broad range of upstream, downstream and energy infrastructure projects worldwide.

Loïc Chapuis, President Project Delivery and Services at Technip Energies, said, “We are pleased to have been selected by L&T to support this major offshore development for ADNOC Offshore. This award reflects the trust placed in our engineering excellence and our proven track record in delivering complex offshore projects. Together with L&T, we look forward to contributing to ADNOC’s strategic objectives and the UAE’s energy ambitions.” 

In February, Technip secured a engineering procurement and construction (EPC) contract from QatarEnergy for the onshore LNG plant of the North Field West (NFW) project. The scope of the onshore EPC contract includes two LNG mega-trains with a combined production capacity of 16 MTPA (a replication of the two trains under construction by Technip Energies and CCC for the North Field South (NFS) project) as well as associated facilities for gas treatment, natural gas liquids recovery, and helium extraction. In addition to LNG production, the project is expected to produce around 175,000 barrels of oil equivalent per day of condensate, ethane, and liquefied petroleum gas (LPG).