This is the second year Deloitte Touche Tohmatsu Limited’s Global Energy & Resource group has published its oil and gas trends and issues analysis for the year ahead.
Bearish economic indicators released in the last few weeks notwithstanding, oil prices are pushing upward, testing the upper limits of the US$ 70 – 80 per barrel range. Serving as a simple yet global and unified measure of economic recovery, it is oil’s price range and the strength and sustainability of the recovery that will impact the ways in which all forms of energy are produced and consumed.
Among the trends and issues explored, China continues to be a priority for many oil and gas executives as they continue to be impacted by that country’s demand for fossil fuels. On the supply side, China’s desire for additional sources of oil and natural gas are expected to continue in the short-term, leading to more mergers and acquisitions within the sector.
Despite the setbacks experienced as a result of the Deepwater Horizon spill, deepwater drilling shows no signs of abating any time soon. Although increased regulatory scrutiny will be the norm going forward, oil and gas companies are demonstrating the same zeal as before although they will need to further quantify the risks. This will include making the “safety case” to government regulators, which details the well-specific tasks and the assignment of risk management responsibilities to all parties.
The methodology for developing this report included in-depth interviews with clients, energy industry analysts and the most senior energy practitioners from Deloitte member firms around the world. I am most grateful to all of them who offered up their insights and expertise at a point when their time and attention was in high demand.
Adi Karev (Global Oil & Gas Leader – Deloitte Touche Tohmatsu Limited)
Download the full report . . . . Oil and Gas Reality Check 2011 – 10 of the top issues facing the oil sector