Doing business in oil and gas is not for the faint of heart. Myriad factors beyond industry control hold enormous influence over every stage of the value stream. Russia’s ongoing invasion of Ukraine and the resulting sanctions continue to redraw the global energy map. Inflation and other economic constraints are mounting in the US and abroad. COVID-19 continues to challenge operations as companies, nations, and individuals negotiate the constant rise and fall of cases. Geopolitical unrest is on the rise around the world. Time is running out for humanity to alter the course of climate change. The list goes on.
Looking ahead, the short term is cloudy, and the long term is opaque. However, while market uncertainty is plentiful, so is opportunity.
“As we look to the second half of 2022 and into 2023, the oil markets face an unusual set of circumstances and challenges. On one hand, the demand outlook for the next 12 to 18 months is deteriorating, as inflation erodes consumer purchasing power and central banks aggressively raise interest rates to combat inflation. On the other hand, due to years of underinvestment globally and the potential need to replace Russian barrels, broader supply constraints can realistically keep commodity prices at elevated levels, even in a scenario of moderate demand destruction,” said Lorenzo Simonelli, chair and CEO at Baker Hughes during the company’s second-quarter earnings call.
“As a result, we believe the outlook for oil prices remains volatile, but still supportive of relatively strong activity levels as higher spending is required to re-order the global energy map and likely offsets moderate demand destruction in most …
This Story Appears In The September Issue Of Gas Compression Magazine
Click Here To Continue Reading This Article In The Digital Edition
Did you know that you can get FREE print and/or digital delivery of Gas Compression Magazine each month. Subscribe today!
Click Here To Subscribe (Gas Compression Magazine is always FREE)
