Norway lowered its original forecast for oil production from 1.52 million barrels per day to 1.46 million bpd in 2014, Reuters reported. This revised projection is on par with last year's oil output. In addition to revising its oil production forecast, Norway also said its investments will be lower, saying investments will rise 2 percent over the next two years.
"The biggest challenge is that costs have increased," said Bente Nyland, director of the Norwegian Petroleum Directorate (NPD), according to Reuters.
NPD said petroleum production is expected to grow to 215 million cubic meters in 2014, an increase of 0.7 percent from 213.7 million the previous year, Bloomberg reported.
As rising costs may decrease oil and gas investments, new developments and projects could be delayed.
"If oil and gas prices fall and costs remain stable or rise, this will have an impact on decisions to start up new projects, and will entail lower investments than included in the forecasts," the NPD said.
Nyland said restructuring among companies is likely to occur with more mergers and acquisitions activity and smaller companies may be the most affected.