CERAWeek 2026: Geopolitics, AI and energy converge in Houston

EXECUTIVE VIEWPOINT 

HERMAN NIEUWOUDT, PRESIDENT, IFS ENRGY & RESOURCES  

Late last month, more than 10,000 energy leaders from nearly 90 countries converged in Houston for the annual CERAWeek by S&P Global conference, often referred to as the "Super Bowl of Energy." The official theme was “Convergence and Competition: Energy, Technology and Geopolitics.” It felt less like a theme and more like a description of reality. 

In the weeks leading up to the conference, military strikes involving Iran triggered one of the most severe energy supply disruptions in recent history. The Strait of Hormuz, the world’s most critical energy shipping corridor, was effectively closed to commercial traffic. Tankers stacked up outside the strait. Flows slowed to a trickle. Within days, the International Energy Agency estimated that roughly 11 MMbopd had been removed from global distribution networks—more than the combined impact of the oil shocks of the 1970s. 

Brent crude, trading near $70/bbl before the crisis, surged past $100 and briefly exceeded $120. By the time CERAWeek opened, prices had settled into the low $100s, still roughly 50% above pre-crisis levels. IEA leadership described the situation in terms deliberately reminiscent of past systemic dislocations. 

This was the backdrop for a gathering that included more than 2,300 companies, over 1,600 C-suite executives and dozens of government leaders. Some senior figures opted to participate virtually or cancelled altogether. Over five days, the conversations that unfolded felt fundamentally different from those of recent years. 

After two decades in energy—much of it in oilfield services, where execution in the field is the product—I left Houston with a single conviction. We are witnessing the most consequential convergence of forces since the modern energy industry took shape. The companies that understand this convergence, and act on it now, will define what comes next. 

THE END OF PRICING RISK AT ZERO 

The Strait of Hormuz has always been the global energy system’s single most obvious point of failure. Around one-fifth of the world’s oil and a significant share of LNG pass through this narrow waterway. For decades, markets effectively priced that risk at zero. That assumption no longer holds. 

Producers across the Gulf have already adjusted output. Assets in multiple countries have experienced damage or disruption. LNG flows have been rerouted or curtailed. At CERAWeek, industry leaders laid out the cascading effects. 

Shell CEO Wael Sawan described a fuel supply chain reaction that begins with jet fuel, moves through diesel and eventually reaches gasoline, rippling across regions. He cautioned that aggressive stockpiling by governments and market participants can turn a severe but manageable shock into something deeper and longer-lasting. 

Chevron CEO Mike Wirth argued that current futures curves still fail to reflect physical realities, noting that today’s disruptions rival or exceed those following Russia’s invasion of Ukraine. Dow CEO Jim Fitterling pointed out that a significant share of global petrochemical capacity is effectively blocked, driving regional arbitrage to levels few anticipated at the start of the year. 

What distinguishes this moment is not only the scale of disruption, but its timing. It comes on top of six years of compounding volatility. In 2020, WTI briefly traded at negative prices. By 2022, Brent and WTI surged above $120 before sliding back toward $70 as narratives swung between scarcity and oversupply. Heading into this year, many forecasts assumed relative stability. Instead, the industry finds itself back in triple-digit pricing. 

One word surfaced consistently in panels, hallways and private meetings: resilience. Not resilience defined by binders of contingency plans, but resilience as organizational capability—the ability to make fast, informed decisions when assumptions break down. As Sawan put it plainly, there is no national security without energy security. 

This shift—from treating disruption as exceptional to treating it as baseline—is unlikely to reverse. Even if tensions ease, the lesson is clear. Risk long discounted can reprice overnight. 

WHEN DISRUPTION REDIRECTS CAPITAL  

CERAWeek also underscored a subtler but equally important reality. When geopolitics forces a recalibration of supply, capital does not simply pause. It moves. 

Sessions focused on how operators are reassessing regions once viewed as long-dated, complex or marginal. The logic is straightforward. When a critical corridor is constrained, every alternative barrel gains value—from mature basins with latent capacity to under-invested regions beginning to re-open. 

History offers plenty of precedent. After every major disruption, capital flows toward perceived relief valves in the system. What is different today is the condition of the assets themselves. In many regions, years of under-investment, sanctions or instability have left infrastructure degraded and records incomplete. Wells, processing facilities, pipelines and terminals may still exist physically, but the institutional knowledge needed to assess, prioritize and rebuild them often does not. 

We have seen this firsthand in regions across Africa, Latin America and Europe. In one case, an operator looking to restart production from a mature field found that decades of paper-based records, multiple ownership changes and years of minimal maintenance had created a situation where physical assets remained, but the knowledge needed to run them safely and efficiently had all but vanished. Rebuilding that picture, from wellbore integrity data to surface facility condition, became the first and most urgent investment before a single barrel could flow. 

This has become the real constraint when capital moves at scale. You cannot deploy tens of billions of dollars effectively when asset data is fragmented, maintenance histories are unclear, and experienced personnel have left. The technology required to rebuild that understanding—to create a reliable picture of what exists, where to invest first and how to track performance—is no longer optional. It is foundational to the next investment cycle. 

This challenge is not confined to any one geography. It applies wherever operators are being asked to restart, repurpose or rapidly scale systems designed for a very different era. 

THE A.I. EXECUTION GAP 

Running alongside the geopolitical story was another theme that surfaced repeatedly: the gap between A.I. ambition and A.I. execution. 

Many energy companies now have board-approved A.I. strategies, senior digital leadership roles and polished transformation narratives. Yet, step onto a pad in the Permian, a platform in the North Sea or a mine in South America, and day-to-day work often still resembles that of several years ago. 

Data shared in Houston confirmed what many practitioners already know. Only a minority of oil and gas companies have deployed advanced or agentic A.I. into core operations, even as roughly half say they plan to do so this year. Awareness is rising quickly. Productivity-changing adoption is not. 

The reasons are familiar. Digital programs stall between pilot and scale. Legacy systems fragment data. Decentralized organizations struggle to drive consistent change. Meanwhile, research from McKinsey and Deloitte estimates that A.I.-driven operational improvements alone could recover $150 billion to $275 billion in value across the sector by the end of this decade—but only if the technology actually reaches the people doing the work. 

The execution gap is not primarily about algorithms. The models exist. The platforms exist. The hard part is the last mile: putting A.I. into the hands of the thousands of people who maintain equipment, schedule work and make operational decisions every day. That means A.I. embedded directly into workflows, not layered on top. Tools that simplify work rather than complicate it. Systems that earn trust incrementally—one correct recommendation, one avoided trip, one prevented failure at a time. 

At IFS, we see this play out across our customer base every day. When A.I. is embedded directly into enterprise asset management and field service management, rather than bolted on as a separate analytics layer, the adoption curve changes. Technicians get recommendations on the tools they already use. Planners see optimized schedules without switching systems. The technology disappears into the workflow, and that is exactly when it starts delivering real value. 

The benefits are tangible. Based on industry benchmarks and IFS deployment data, predictive maintenance can reduce maintenance costs by around 20% and cut unplanned downtime by as much as half. AI-enabled scheduling improves first-time fix rates dramatically. Top-performing field organizations now achieve rates in the mid-80% range, compared with barely above 50% for laggards. In an industry where downtime carries real cost and safety consequences, those are not incremental gains. They are the difference between an operation that runs and one that runs well. 

THREE FORCES, ONE WINDOW 

What became clear in Houston is that three forces are converging simultaneously, and none is waiting for the others. 

First, A.I. acceleration. Capability is advancing faster than most projections from even a few years ago, while energy demand from data centers and A.I. infrastructure is rising in parallel. The same technology driving demand growth is also becoming part of the solution through smarter dispatch, load balancing and operational optimization. The IEA now projects that data center electricity consumption could more than double by 2030, a figure that would have seemed extreme just two years ago. For the energy sector, this creates both a capacity challenge and an opportunity: the same AI that consumes power can also help produce and distribute it far more efficiently. 

Second, structural volatility. The past six years—a pandemic, a land war in Europe, and now a crisis in the world’s most critical shipping lane—have made it clear that volatility is structural, not temporary. Year after year, consensus forecasts have missed the mark. The companies creating value are those that can adjust capital and operations faster than disruption unfolds. 

Third, the workforce reckoning. The workforce is aging. Fewer young professionals are entering technical roles. At the same time, investors demand leaner operations and higher returns. This challenge will not be solved by adding people. It will be solved by making the people we have more effective, supported by tools that amplify judgment and preserve hard-won knowledge. 

LEADING THROUGH CONVERGENCE 

The immediate message from CERAWeek was pragmatic. Do not get caught. Do not get caught dependent on a single chokepoint. Do not get caught with assets you do not fully understand. Do not get caught promising A.I. while leaving the field without tools that work. 

The longer-term message was more consequential. The global energy system is being redesigned in real time. Technology decisions made in the next 24 months will shape who operates it in the 2030s. 

The leaders best positioned for what comes next are holding both horizons at once—solving today’s problems while building tomorrow’s advantage. 

The Strait of Hormuz will not be the last disruption. Today’s hotspots will not be the last regions asked to ramp quickly. AI will not slow down. The companies that come out ahead will be the ones that can read a disruption on Monday and reallocate resources by Friday, not the ones still updating spreadsheets while the world moves on. 

The convergence is already here. The companies that treated this year’s CERAWeek as a wake-up call, rather than just another conference, will be the ones still leading when the next disruption hits. 

HERMAN NIEUWOUDT is President of the Energy & Resources unit at IFS. He has more than 20 years of global oil and gas leadership experience, primarily in oilfield services and operational technology.