Optimism appears to be rising for a rebound in oil prices in 2017, yet the industry will continue facing challenges, thanks to weak demand and lingering fallout from the past several years.
At a glance:
- Most oil & gas players have smartly used the past two years to reduce costs, but there is more work to do.
- We believe this year will be characterized by three Rs: continue restructuring, more realignment through M&A, and finally, for some, a year of rebuilding.
- Upstream companies should plan conservatively on oil prices and accept nothing less than a high-performing organization.
- Oilfield services and equipment companies should cautiously approach market share gains and proactively raise capital.
- Downstream companies should take a page out of the upstream book and focus on more aggressive cost-optimization strategies.