The Italian Energy Exec Who Thinks Gas Can Unite Egypt and Israel

The following is a condensed and edited interview with Claudio Descalzi, CEO, Eni.

How have you responded to the sharp decline in crude oil prices?
Fortunately we had a strategy to own conventional assets, which means a very low cost and very low break-even price. At the moment we have one of the lowest in the industry, because our technical cost is lower than $20 per barrel. And the breakeven is now at $27 per barrel. Last year it was $45. We don’t control the price, so we have to work on what we can control. The price of oil dropped about 60 percent to 70 percent, and costs dropped only by between 25 percent and 30 percent. So we have to work on that.

If we’d made different choices—complicated projects or tar sands or Arctic projects—life would be quite difficult.