Energy expert and UWI Prof Andrew Jupiter says Royal Dutch Shell's acquisition of the BG Group will have a positive impact on the local energy market.
Jupiter, who commented on the mega merger in his contribution to a recent pre-budget forum at UWI's St Augustine Campus, said: "Shell will do exactly what is required of them in terms of the contractual arrangements with BG. Why? They have done it throughout the entire world and as such contractual obligations are important and the sanctity of contract is important everywhere Shell goes.
"The difference is that Shell is a gorilla. They will become the biggest gorilla in T&T if everything goes alright and you have to know how to treat the biggest gorilla."
Jupiter, who also addressed concerns about the drop in global oil prices, said there was the possibility of Iran becoming a significant world player if a deal between the US and its allies should see sanction lifted.
He described the situation as "very complex" and said experts in some quarters believed the oil price crunch was a result of a showdown between the United States and Saudi Arabia–two of the world largest oil producers.
"In 2008 the US produced about 4.7 million barrels of crude per day. In 2005 the US produced 8.7 mil of crude per day. So if everything stabilises what is the additional production coming from Iran?
"When you look at the data, at Iraq and Kuwait, it takes some time for production to come on stream.
"Let us say production stabilises in the next year in Iran, it will not adversely affect, in my view oil prices, because the real players in oil prices now, as such, is not Opec. Opec will still have a say.
"It is unheard of that an Opec meeting be called in the days when Opec was in charge and there is not an effect on oil prices. Venezuela's President (Nicolas) Maduro went to every Opec country including Iran, including Saudi Arabia and nothing moved. The real player is the US," he said.