Like many industries, companies within the oil and gas industry employ the use of various types of research and development for a multitude of reasons. Examples of the most pressing needs of the oil and gas industry are to 1) garner a better and more detailed understanding of the earth and its natural processes, and 2) develop and commercialize new technologies to aid the processes involved in the upstream and downstream sectors of the industry.
The collapse in oil price in the second half of 2014 has brought a sharp cash crunch to the industry. R&D spending in oil and gas rose over the last decade, following prices and as companies have taken on more complex and challenging projects. By 2013, leading researchers and developers in the oil and gas sector were spending over $15 billion annually, double that of a decade earlier.
Restless about Connected Devices and Security Risks – Four Strategies to Help Oil & Gas Execs Sleep Easier
Homero Endara | GE Oil & Gas
The decline of oil prices places immense pressure on the Oil & Gas industry, and organizations are looking for ways to safely cut operational expenses to respond to those pressures and stay competitive in the current price market. According to Capital Economics, the 50 percent drop in crude oil prices will reduce annual revenue to oil producers worldwide by more than $1.5 trillion. In the past year, we have seen smaller companies go out of business as well as a number of mergers and acquisitions across the industry as a result of market conditions.
Tom Mallon | GlobalView
Why Oil Prices Keep Falling?
Back in June 2014, the price of West Texas Intermediate (WTI) crude oil was around $105 and Brent was around $115 per barrel. Today we are at around $57 and $64 per barrel, respectively. This represents about a 40% decline in global oil prices. What happened? To put things into context, let’s look back to the middle of the 2000’s when global oil consumption was surging and outstripping supply, due in large part to China. This led to the WTI oil spike of approximately $148 per barrel in July of 2008. Since then, for the most part, oil had traded at or above $100 per barrel until the middle of 2014. So…