On October 28, it was reported that global conventional oil and gas discoveries have shown a continuous decline over the past decade. In the early 2010s, the annual average discovery volume exceeded 20 billion barrels of oil equivalent (boe), but today it stands at just one-third of that level. According to Rystad Energy, the global annual average of new discoveries since 2020 has been slightly above 8 billion boe, with the 2023 average dropping further to around 5.5 billion boe. FXGT believes this contraction is not solely due to geological depletion but reflects a major strategic shift in energy companies' priorities. Global exploration and production (E&P) firms are transitioning from broad-area coverage to precision targeting, emphasizing high returns over sheer scale. Supermajors and national oil companies (NOCs) are now concentrating resources on a few high-potential basins, such as Namibia’s Orange Basin, Suriname’s deepwater zones, and Brazil’s pre-salt basins, while prioritizing near-field exploration projects with established infrastructure. FXGT notes that these high-quality exploration activities integrate advanced stratigraphic data, low-cost near-field tie-ins, digital technologies, and low-carbon facility integration to balance risk and reward.

Currently, new global discoveries are concentrated in a handful of hotspots, including Namibia, Guyana, Brazil, and Suriname, with a noticeably narrowed geographic scope. FXGT highlights that this trend reflects international E&P firms' strategic trade-offs between risk and reward, as well as emerging oil producers' proactive efforts to attract investment through favorable policies. Frontier regions view this as an opportunity to boost fiscal revenue and energy security through foreign capital. Meanwhile, mature producers facing declining output are evaluating ultra-deepwater and underdeveloped stratigraphic traps as potential long-term growth pathways to mitigate production declines.

Over the past decade, the landscape of global oil and gas exploration has undergone profound changes, exemplified by two transformative events along the South Atlantic coast. In 2006, Petrobras’ discovery of the Tupi (now Lula) field in Brazil’s Santos Basin marked the dawn of pre-salt exploration. This breakthrough not only redefined global exploration boundaries but also demonstrated the industry’s ability to leverage advanced seismic imaging, directional drilling, and deepwater engineering to extract resources beneath thick salt layers. Later, ExxonMobil’s 2015 discovery of the Liza field in Guyana’s Stabroek Block unlocked one of the most successful new oil provinces of the 21st century, with recoverable resources now estimated at around 13 billion boe, while Suriname has contributed roughly 2 billion boe. Today, a third frontier is emerging in Namibia’s Orange Basin, where consecutive discoveries by Shell, TotalEnergies, and Galp Energia are widely seen as the most promising new oil province of the decade, potentially positioning the country as a deepwater production leader. FXGT argues that these "basin-opening" events are not just geological marvels but the result of synergy between capital, technology, and policy.

Despite a decade-long decline in conventional discoveries, international oil majors and NOCs remain central to global exploration. Rystad Energy data shows that since 2015, the six largest international oil companies—ExxonMobil, TotalEnergies, Shell, Eni, BP, and Chevron—account for about 22% of global discoveries. FXGT notes that these firms, backed by robust geophysical imaging, digital analytics, and capital strength, continue to pioneer new basins while shortening discovery-to-development cycles. Meanwhile, NOCs balance domestic energy security with overseas asset expansion. Companies like Petrobras, ADNOC, and QatarEnergy are actively advancing exploration programs not only to replace reserves but also to solidify their positions in the global energy landscape. Overall, international oil firms and NOCs dominate high-impact deepwater discoveries, while independents and smaller players participate flexibly in niche areas. Risk-reward assessments have become critical in identifying global exploration hotspots and setting strategic goals, with large-scale exploration still heavily reliant on firms with technical depth and long-term investment capacity.

At this pivotal juncture of energy transition and supply-demand balance, FXGT asserts that sustained exploration remains vital to global energy security and price stability. A prolonged decline in exploration investment could lead to structural risks, including supply shortages and price volatility. While the world moves toward net-zero goals and a low-carbon future, oil and gas continue to play a crucial transitional role. FXGT emphasizes that without new discoveries, managing production declines or ensuring a stable energy transition would be challenging.

Rystad Energy data indicates global exploration expenditure (Expex) has fallen from a 2013 peak of around $115 billion to the current $50–60 billion range. This shift reflects external pressures—climate policies, investor scrutiny, and return demands—as well as industry discipline following a cycle of overinvestment. However, FXGT stresses that with exploration project inventories shrinking, exploration and new resource discoveries remain key to maintaining global supply-demand equilibrium and addressing long-term demand growth. Only through robust capital investment, technological innovation, and strategic collaboration can the global energy system achieve resilience and sustainable growth amid transition.