Lorenzo Simonelli, CEO of Baker Hughes, speaks to CNBC on the floor of the New York Stock Exchange (NYSE) in New York City, USA, on September 4, 2025.
Gina Moon | Reuters
Baker Hughes does not yet see rising borrowing costs slowing investment in major energy projects, with the company’s CEO pointing to strong demand for natural gas and electricity due to the global build-out of artificial intelligence infrastructure.
“We don’t see an economic slowdown. In fact, bankability is based on offtake agreements that are currently in place and the outlook for energy demand,” Chairman and CEO Lorenzo Simonelli told CNBC at the Gastech conference in Bangkok.
Simonelli said financing remains an important consideration for projects, but rising energy demand from population growth, industry and data centers continues to support investment.
He said: “Energy demand will not necessarily slow down as the population grows, and the industrial achievements of data centers and AI are becoming more relevant, and energy supply and energy sources are intrinsically linked.” “As such, we have not yet seen any such phenomenon and continue to monitor it.”
Simonelli’s comments come as the Iran war disrupts energy flows in the Middle East and as oil prices soar above $100 a barrel, raising concerns about inflation and borrowing costs.
The conflict has also disrupted natural gas markets, restricting shipping through the Strait of Hormuz and threatening LNG supplies from Qatar, one of the world’s biggest exporters.
Simonelli said high prices themselves could eventually stimulate the investment needed to bring additional supply to the market.
“We’re ‘all in’ on the short-term forward-looking side,” he said. “Obviously high pricing will also lead to investment today, which will lead to supply tomorrow.”
Baker Hughes expects prices to ultimately remain range-bound and sees little risk that the coming wave of LNG supplies will cause a prolonged oversupply. The company estimates that installed LNG capacity will need to reach 900 million tonnes per year by 2035 to meet future demand.
AI is becoming an increasingly important source of that demand. Simonelli said Baker Hughes’ rapid expansion of data centers will not slow, despite growing concerns about power and water consumption.
“We don’t think there’s going to be a slowdown,” he said, adding that Baker Hughes is increasing production capacity to meet demand.
In Southeast Asia, too, grid constraints are pushing some data center operators toward behind-the-meter and distributed generation, an area where Baker Hughes provides equipment.
Simonelli sees natural gas playing a central role in meeting growing electricity demand. He said Baker Hughes has a backlog of more than $37 billion, including demand for gas infrastructure, data center generation and LNG.
“If you look at natural gas, it’s not a transition fuel, it’s a destination fuel,” he said. “We are entering a decade of energy demand, and gas is at the heart of that.”
