oil n gas

There are various industries which face the challenge of balancing demand and supply. There are some where the supply exceeds demand, and many competitors have to bow out of the industry in that scenario. On the other hand, there are times when demand is more than the supply. This one suggests a powerful situation of the suppliers. They can determine the prices that they wish to charge, and govern the transaction. However, if this situation arises in an industry which is of high significance to the wellbeing of many people and economies then it turns into a serious challenge. That is the situation that oil & gas industry is facing.

The supply is limited, and the demand is way more than the supply. The prices, in certain countries, are regulated, and the suppliers are responsible to ensure that they can meet as much of those countries? demand as possible.

The industry is dynamic, and it is changing drastically. In the coming times, it is expected to face more challenges. As we know, oil and gas is a major part of the economies of various countries. Therefore, the industry has to secure a safe supply of the same to the countries which need it. Consider the case of the developing countries. These are the countries which are heavily reliant on oil & gas to support the growth wheel of their economy. Additionally, as the supplies deplete, countries have to find new places and avenues of oil exploration. This is the reason why so many project management jobs are coming up in the market.BASIC INFORMATION ABOUT THE INDUSTRYBefore we go on to speak about the industry, let us look at some basic information. Oil is obtained from the earth?s crust. On the other hand, crude oil can be explored from under the sea. Generally, the source of crude oil is those dead sea creatures that got buried within the surface of the sea. They get decomposed under the surface. That is what can be later converted into crude oil that we all make use of.So, what is the process involved in getting the oil from the time of identifying it to the time it is finally ready to be used? Here is a brief description of the same:Exploration: The first stage in the process is exploration. As the name suggests, this is the time when new locations for oil have to be explored.

This is a complicated process because oil reserves are depleting. Moreover, this industry, like others, is starved of time. Hence, exploration has to be done within a short period of time, which is not always possible.Extraction: The next stage is extraction. Once the location has been identified, oil has to be extracted from the same.Refining: This is the industrial part of the process. Under this process, the oil that is explored is converted into usable form. The explored form of oil cannot be readily used by the industry. Therefore, the explored oil is made to go through various processes before it is put in use.Transportation: Finally, the oil has to be transported. The first step is to make the oil reach to oil tankers. This can be done with the help of pipelines. Once that task has been performed, the oil tankers take the oil to different places of the globe. Many other modes of transportation are also used, eg. Train.CHALLENGES WITH THE OIL & GAS INDUSTRYWe mentioned in the earlier part of this article about the challenges and complexities that the oil and gas industry currently faces. Following is an explanation of each one of those:Demand Vs Supply: As mentioned earlier, this industry faces the problem of demand-supply mismatch. Oil and gas industry is critical for the smooth functioning of modern societies. Therefore, companies have to ensure that they find right sources of Oil & Gas exploration.Costing: The pricing of oil is a sensitive issue. Companies cannot tamper with the prices at their own discretion.

The reason for this is that every increase in the price of oil leads to a consequent rise in the prices of various other products in the market. Therefore, the companies have to endeavor to control product costs in order to ensure that their business happens to be viable to them. The companies have to closely monitor the cost that they incur on oil exploration. The same diligence has to be exercised at the time of oil drilling too. Furthermore, there is a need to develop technologies that can assist companies in performing their tasks without incurring excess costs.Environment Considerations: The oil and gas industry has a major influence on the environment too. The exploration activities could lead to various environmental hazards, and it is important that those are kept under control. The best strategy to follow for this is to develop company policies and get all employees to follow that.

Area of Exploration: It is not possible to explore oil anywhere you want. Companies have to follow the guidelines and restrictions of the government. For example, Alaska is not open for oil exploration due to the environmental degradation that such activities can potentially cause.Transportation: Transportation of oil from the area of exploration to the place where it has to be consumed is a challenging job. Not only is it about the costs that are involved in the process but also about the other risks that transportation of oil entails.Complicated Process: Finally, the entire process (from oil exploration to transportation) is a complicated one. One has to be careful at every step to avoid a mishap. Right from the exploration equipment to the rigging hardware to the transportation trucks, they have to all be of top quality and in top condition during use.The oil and gas industry is faced with numerous challenges. Firstly, the process is long-drawn and complicated. Moreover, there are various restrictions and precautions that need to be taken to ensure its smooth functioning.

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