6 replies to this topic

[Zauberberg]

So it has been several months already since crude oil prices plunged to 50-60$/bbl. It seems like many Operator and Engineering companies are having hard times - projects being cancelled, layoff of workers, reduced exploration and drilling activities, no recruitment etc. etc.

 

How do you experience these months personally and how your companies handle the turmoil?

 

I see that even forum activities at ChE Resources and Eng-Tips appear a bit reduced when compared to some earlier periods. Perhaps this is just my observation since I got used to 40-50 posts per day, regardless if it is Monday or Friday.

 

Would like to hear from members - whatever you can share or feel like sharing. Thanks.

 

[thorium90]

Yes, it does seem quieter now. I thought it was because as the forum size increases, people would find it easier to solve their problems with the search rather than by starting new threads and hence there are lesser new threads. I'm not so sure if there is a correlation with oil prices...

[Bobby Strain]

These low oil prices are a blessing, not a crisis. All the company categories you mentioned have always behaved in the manner you are witnessing now. Remember, a few years ago we were building LNG import facilities in the US.  Now we are building LNG export facilities, triggered by high oil prices. I talked with a recruiter recently. He said he now recruits civil engineers for infrastructure projects. There are always opportunities in all economic conditions.

 

Bobby

[Zubair Exclaim]

I guess different parts of world are experiencing different strains. In small oil producers with high production cost this slump is hitting real bad. New projects have been cancelled and economies have been jolted. 

 

Its a domino effect .. oil producing countries are cancelling projects and technology based countries are getting hit due to cancellation of projects. Next four to five years will be on see saw  and will be interesting to see the balancing of oil prices.

 

Like Bobby said ... USA might be benefiting since whole new type of infrastructure is being developed there due to shale.... but out there in middle east Africa, Far east and Russia this is hurting the companies as well as manpower.

[curious_cat]

Ironically, for the rest of the world its a "crisis" when the prices are high. 

[curious_cat]

These low oil prices are a blessing, not a crisis. All the company categories you mentioned have always behaved in the manner you are witnessing now. 

 

I think in many cases Management lacks the foresight & long planning horizons. The drop in prices is only temporary. I'm sure in a year or two or three we will be back to the same high prices. 

 

Oil & Gas projects are long delivery. If companies respond in a knee-jerk fashion by " projects being cancelled, layoff of workers, reduced exploration and drilling activities, no recruitment" then it's rather sad. When the prices rise & the demand spikes they again get caught off guard because they cannot raise capacities fast enough. 

 

Perhaps the quarter to quarter performance expectations imposed by unrealistic stock market investors are a part of this very short-sighted mode of response. 

[shan]

Just bury my head into the sand like a ostrich.