The future of oil and gas Industry: are you ready to
respond near term changes oil & gas price rebound?
Oil and Gas Industry cyclical Price history
The oil and gas prices are the most watched commodities price. In 2014, the
crude oil price was about $ 100 per barrel and continues to fall by less than $
45 per barrel in April, 2016. The price cyclical has been notified by many
experts and professional in the industry. The price changed is influenced by
many factors such as supply & demand, growth and slow down of economic,
change in political landscape, war, and environment regulation. For instance, in
1960s, the major IOCs held most of the price that they can drive the power in
the market high while the buying price to oil states remain low, however with
emerging of OPEC power in 1973, the group increasing the price from $ 3.65 per
barrel to $ 11.651 per barrel . The complete pricing oil history can be found in
BP statistical review, since 1860 price to latest price. This provided
indication that the oil price will be rebound after current low price period
which need drivers to be involved to the increasing oil price.
The optimistic of the future oil and gas industry
The oil and gas industry is one of the most important industries in world
global economic development because the important roles of the oil and gas
industry to support other industries and its product touch everyone daily live.
For instance, oil and gas consumed by Electrical Oil or Gas Turbine Generator to
generate electrical power that distributed to industrial and manufacturing
activities to produce various products to support human live such as cosmetic,
plastic, transportation etc. Furthermore, demand of the oil and gas industry is
driven by two major factors : growth population and increasing of people income.
According to BP, 2016 Energy Outlook, By 2035 the world projected population
will be 8.8 billion and the same period the GDP growth double more than 2016.
This provide positive indicator to the oil and gas industry.
What we need to prepare for the next oil and gas price rebound.
Considering the optimistic of increasing oil and gas price, whether we are
professional who work in this industry or we are the decision maker to enhance
the oil and gas company competitiveness, the following actions important to be
considered before the oil price increase:
- Improve the competencies in oil and gas business management.
- Revisit the strategic environment and strategic management in oil and gas
industry.
- Review the legal aspect including contract law, applicable in oil and gas
industry contract whether It is internationally, regional or domestic
regulation.
- Re-fresh the source capital investment, project economic evaluation and
financial performance knowledge. This can be originated at Corporate Finance
Oil and Gas Industry.
- Re-organize the capabilities of business development team in the oil and
gas industry.
By conducting above activities, it is expected that employees, executive,
decision maker and function of companies and other organisations involved in
financial, commercial and contractual activities will be ready to take future
growth opportunity when oil and gas price return back to profitable level.
References:
BP. 2016 Energy Outlook.
Global Oil and Gas Industry, 2011 by Inkpen and Moffet.
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