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An In-Depth Look At The Latest Trends In The Oil And Gas Industry

The oil and gas industry is an immensely dynamic and variable sector. Keeping abreast of the recent trends within the industry is paramount to those energy ventures that wish to succeed within it. Simply being part of the oil and gas sector is no longer enough to be profitable within it. The team here at TriStone Holdings, a UK oil and gas investment company, wanted to examine some of the latest trends in the oil and gas industry in what is a finely poised time for the industry. From societal-driven change in attitudes towards more environmentally-friendly practices, to the unexpected market hit from COVID-19, the industry is certainly in an interesting position. Read on to find out more.

Increased Sustainability


This has been a focus for the oil and gas industry for some time now, and oil companies are looking to reduce their environmental impact and allay their stakeholders’ concerns with regards to sustainability, whilst simultaneously continuing to produce increasing quantities of oil and natural gas. Much of what oil and gas companies are looking to do revolves around tightening up their existing processes. This includes rectifying methane leakages along pipelines and reducing the quantities of water wasted during drilling processes by recycling brackish water. If you want to find out more about how the oil and gas industry is trying to clean up, read our previous blog here!


Continual LNG Growth


In recent years, the liquid natural gas (LNG) market has thrived. This growth kick-started in earnest around the turn of the millennium. In fact, according to Shell, the trade of LNG increased by roughly 200 million tonnes between 2000 and 2017. This growth has been driven, amongst other things, by several key factors:


Lower-Carbon Alternative


Whilst still a fossil fuel, natural gas provides a more environmentally-sustainable friendly alternative than oil and diesel. For example, when burnt natural gas produces 30% less CO2 than fuel oil and almost no sulphur dioxide (SO2 – an incredibly environmentally-damaging indirect greenhouse gas). LNG is a particularly promising transport fuel alternative, especially in the shipping and haulage sectors.


Location


Natural gas fields are also readily found throughout the USA and this geographic potential when paired with existing oil and gas infrastructure (pipelines, for example) make it an understandably attractive proposition for the energy sector.


Scalability And Immediate Provision


As a fuel, LNG extraction and production can be scaled up remarkably effectively and quickly, as per the demand. Not only this, but it’s a reliable energy source; renewable

energy sources like wind power, for example, hinge on a more fluctuating source, whereas LNG provides consistency as an energy source.


Rebounding From COVID-19


Nobody could’ve foreseen the events surrounding COVID-19 and the subsequent impacts it has ended up having on the oil and gas industry. If you’d have said to someone in the sector in 2019 that US oil prices would turn negative in 2020, you’d have been laughed out of the office. And yet. That’s exactly what happened towards the end of April this year with COVID-19 taking over as the latest trend in the oil and gas industry. The renewable sector, it’s worth noting, has also taken a substantial hit due to the virus. Other industries may have buckled and made knee-jerk decisions under such stressors, but such turbulence is nothing new for the oil and gas industry. It has experienced huge hits in the past - albeit not quite as drastic as this - and has managed to recover relatively quickly. There’s no reason that this time should be any different for the sector, and oil has already shown signs of recovery in the USA, for example.


The rate of recovery will be very much dependent on the rate of lockdowns easing, upon which both the corporate and consumer markets depend. It is thought that, save for a second wave of COVID-19, pre-virus demand could be reobtained by 2021. It’s also likely, however, that the recovery will be far-from linear and that there will be numerous smaller market-falls before that degree of ‘normality’ is restored.


The oil and gas industry has often gone through periods of uncertainty, and whilst it has often had to adapt and change, it’s still a fundamental facet of the energy sector. So, if you’d like to find out more about the latest trends in the oil and gas industry, then get in touch! Contact TriStone Holdings today on 0800 055 7079 or email us on enquiries@tristoneholdings.com.

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