Oil and Gas: Predictions for 2021 and Beyond
2020 is now over. To say it was a turbulent year would be quite an understatement. Many companies across many industries have been forced to either halt operations or shift to new remote working protocols. Unfortunately, many employees have been laid off, while some businesses have closed operations for good. The economy is gradually getting back on its feet, but the repercussions of the pandemic will continue for months and years.
The new normal is here, and we are all learning to adapt. How will our changed state of affairs affect the oil and gas industry in 2021 and beyond? Here are some oil and gas predictions for the months ahead.
2021 Oil and Gas Predictions
From an oil and gas market predictions perspective, changed operations will have a big impact. For example, all enterprises are experiencing fewer face-to-face transactions, as well as more major M&A action.
Swapping handshakes for digital connections
Historically and traditionally, transactions in the oil and gas industry have always been the in-person, handshake-selling type. This is an industry that relies heavily on trust and networks, and in-person meetings are irreplaceable there.
However, the pandemic has changed this, and companies have rapidly embraced digital processes. This may have lessened the personal connection between client and provider, but it has provided organizations with a nimbleness and the agility most of them did not have before.
This tradeoff will have lasting effects. Which operators can maintain the personal touch despite new restrictions? Which can focus on high touch client relationships, without sacrificing digital agility? These and many other questions will become increasingly relevant.
Increased mergers and acquisitions
On the other hand, we’ve already seen some major mergers and acquisitions (M&As) happening on the operator side. Going forward, we’ll be seeing more of this on a global scale, especially on the service provider side.
Companies buying companies in different parts of the world will become a strategy for enterprises to consolidate into a bigger organization with a broader reach. This will allow them to take advantage of scale-up attorneys that they would not have been able to work with prior.
Digital solutions coming to the fore
In terms of tools and solutions, predictions for the oil and gas industry forecast an increased adoption of digital technology and processes; handheld or mobile devices; AI-driven solutions; and efficiency softwares like FieldFX.
With more remote activities, mobile devices and AI-powered solutions have become necessities to conducting business. Reasonable price points for such tools and solutions have also sped up such adoption. Oil and gas companies tend to be pioneers and first-and-fast followers. So companies who have not adopted such technologies by now will most likely be racing to embrace them in order to win more business and compete effectively in the market.
Managing the Turbulence
These developments come with their own drawbacks. Though some of these changes will be positive over the long term, there are always teething problems with abrupt change.
For one, onboarding employees new and old in a high-turnover environment presents challenges for companies. COVID-19 caused the closure of at least 19 energy companies over the course of 2020. But eventually, say 15 months from now, enterprises will have to rehire all those workforces back. And with that comes the need for training tools for those mobile field workers, because the majority of these people will function out in the field.
These workers will need to go through some type of training beyond just the mobile technologies they’ll be using. Companies will need to train them on their internal processes. Employees will need to follow policies on expenses, reporting, HR, and more. Certain companies may be tempted to stick to manual processes, but they’ll be fighting an uphill battle.
Organizations, as a result, will need continuous and ever-evolving change management strategies. Intuitive and easy-to-use solutions like FieldFX specifically geared towards field engineers will help them easily absorb new company processes.
Moreover, even after the pandemic subsides, the industry will most likely stay remote. The capabilities and benefits that such field operations management tools afford will make companies more open to embracing these technologies.
Finally, for many companies, the sudden onset of the new normal presented enterprise leaders with communication and alignment challenges. Simulating an office environment in a virtual setting puts pressure on leadership to provide the necessary tools. However, going forward, organization leaders need to develop an interest in ongoing communications, ensuring channels are open throughout the company. Adopting the right communication tools will help enterprises talk to remote working and field personnel.
Scalable Solutions Are the Future
Some oil and gas predictions look at the amount of data that the industry generates, and speculate that it could potentially overwhelm companies. As enterprises utilize more IoT devices and adopt more integrations, they will naturally generate more data. This data stream has to be managed and leveraged effectively.
Happily, systems driven by machine learning and AI are now very good at processing data. Scalable solutions and systems constantly evolve and mask the volume of data created. Furthermore, certain tools have data reporting and analytics capabilities that process and simplify raw data for end-users.
Additionally, programs that allow modifications based on customer feedback are becoming the norm. For example, solutions now empower customers that want faster data entry by letting them track items on quotes, field tickets, or log assets into a work order through QR codes. Solution providers that use customer feedback to develop their product to provide improving quality of service are sure to cement their place as industry leaders in the future.
These oil and gas predictions are not set in stone. However, companies that want to be leaders in their space should think carefully about how the industry will look in three, six, and twelve months, and act accordingly. Big changes are coming; enterprises should also take the opportunity to improve their businesses by digitally transforming their processes. Learn more about the inevitable oil upswing.
In short, the name of the game right now is agility. Things are happening faster than before, changes have become so sudden, and expectations rise quickly. Therefore, leveraging digital transformations to put themselves in a position to be more adaptable, more agile, and more competitive, is what savvy companies are doing. Conversely, organizations that fail to react to these new opportunities tend not to become leaders over time.