The ‘KPMG 2025 Global Energy, Natural Resources and Chemicals CEO Outlook‘, looked into the minds of 110 CEOs from companies with annual revenues of over US$500 million across the world’s largest economies.
Despite ongoing economic and geopolitical challenges, CEOs in the energy, natural resources, and chemicals (ENRC) sector remain confident in their growth prospects.
Key Highlights
Optimism Rises Among Energy Leaders Despite Inflation and Market Volatility
- 84 per cent CEOs are optimistic about mid-term industry growth, up from 72 per cent in 2024
- Optimism is fueled by strong demand for fossil fuels and renewables and Innovation in energy storage, smart grids, and carbon capture.
- 78 per cent CEOs remain positive about their own company’s growth, though slightly down from last year. Concerns include shifting regulations, trade volatility, and inflation—especially in the chemicals sector.
- M&A outlook-
- Only 36 per cent expect to pursue ‘high-impact’ deals in 2025 (down from 58 per cent in 2024)
- 55 per cent anticipate ‘moderate’ deal activity (up from 38 per cent in 2024), indicating a shift to more cautious strategies.
AI Momentum Builds—But Cyber Risks and Data Barriers Loom Large
- 65 per cent CEOs rank generative AI as a top investment (up 12 per cent increase from 2024).
- 72 per cent plan to allocate 10–20% of their budgets to AI in the next year.
- 66 per cent expect ROI from AI within 1–3 years (up from 15 per cent last year).
- 51 per cent believe agentic AI will transform operations and workforce efficiency.
- Key barriers to AI adoption: Ethical concerns (55 per cent), Fragmented data systems (49 per cent) and Regulatory complexity (47 per cent)
- Top Technological risks affecting cybersecurity- Fraud (64 per cent), Identity theft and data privacy (59 per cent) and Cyber-attacks (51 per cent)
Climate Pressure Mounts as AI Becomes a Catalyst for Sustainability
- 82 percent CEOs believe AI can support emissions reduction and energy efficiency.
- 62 per cent are confident in meeting 2030 net-zero goals
- Only 38 per cent fully integrate ESG into capital decisions
- AI’s role in sustainability:74 per cent see AI enhancing climate risk analytics and 79 per cent support AI for improving sustainability-related data and disclosures
