Geopolitics and the energy transition are the most pressing themes for the oil and gas industry in 2023, according to data and analytics company GlobalData.
In a statement sent to Rigzone on Thursday, GlobalData noted that geopolitics has become a pivotal macroeconomic theme for the oil and gas industry ever since the start of the Ukraine conflict and added that oil and gas companies will continue to pursue “newer industry themes that support the energy transition towards zero emission technologies”.
The statement highlighted that a new report by the company had identified 20 “prominent themes” impacting the oil and gas sector this year. The report revealed that artificial intelligence, blockchain, cloud computing, cybersecurity, the Internet of Things, robotics, and the metaverse will be “the disruptive tech themes impacting the industry”, GlobalData outlined in the statement.
“The current geopolitical conflict in Eastern Europe is deeply impacting the global oil and gas industry and reshaping its supply chains,” Ravindra Puranik, an Oil and Gas Analyst at GlobalData, said in a company statement.
“In this environment, industry participants need to sense the scenarios that could either diminish their profitability or open new market avenues,” Puranik added.
“The ongoing transition towards clean energy sources will also weigh heavily on the oil and gas players. Themes such as renewable energy and electric vehicles are major disruptors to the industry, while CCS and low-carbon hydrogen will create new opportunities for oil and gas players in the coming years,” Puranik continued.
The GlobalData analyst went on to note that technology themes will continue to shape operational capabilities in this decade.
“Timely and methodical investments in tech themes could provide competitive advantages for oil and gas players,” Puranik said.
In its report, GlobalData classified its top 20 themes for 2023 into four categories, comprising industry, technology, ESG, and macroeconomy. The report highlighted several “key players” including BP, Shell, Equinor, ExxonMobil, Eni, Chevron, TotalEnergies, and Saudi Aramco.
Renewable Energy
In a separate statement sent to Rigzone last month, GlobalData noted that oil and gas players have pledged “considerable investments” in the renewable energy market to improve their share in the coming years.
The statement highlighted that oil and gas companies held little over one percent of the total installed renewable energy capacity globally in 2022 and outlined that renewable power generation across the world is expected to grow at a compound annual growth rate of 6.9 percent between 2022 and 2030.
“Leading oil and gas companies are expanding their exposure to renewable energy through increased investments, as international bodies, such as the United Nations, have highlighted the need to mitigate carbon emissions,” Puranik said in a company statement at the time.
“Going forward, the oil and gas industry will increase its adoption of zero-carbon sources, with alternatives such as solar and wind power becoming increasingly popular,” Puranik added.
“Oil and gas leaders are increasingly positioning themselves as the providers of renewable power and renewable fuels. Solar and wind power projects have comparatively higher growth potential and are also witnessing falling project costs. This makes them ideal investments for oil and gas companies in their energy transition,” Puranik added.
2023 Oil, Gas Themes
Back in January this year, Matthew Bey, a Senior Global Analyst for risk intelligence company RANE, told Rigzone that the impact of Western sanctions and the G-7 price cap on Russian oil will be the top issue for the oil and gas sector in 2023.
Micah Smith, a Senior Partner and Global Oil & Gas Practice Leader at McKinsey & Company, told Rigzone at the time that one word that will define the oil and gas industry in 2023 is “and”.
“As the industry continues to adjust to a new challenging reality, the imperative will be achieving the balance of clean and affordable and plentiful and secure energy,” Smith told Rigzone in January.
In a report outlining 2023’s key oil and gas themes published late last year, analysts at Fitch Solutions Country Risk & Industry Research stated that, in 2023, ongoing supply growth and weaker demand growth will ease tight markets and relieve some of the price pressures that pushed energy prices higher in 2022.