ENERGY TRENDS
The Top 10 Oil and Gas Trends to Watch Oil and gas CIOs must be aware of these trends including accelerating digital innovation, rethinking vendor partnerships, and reacting to climate change to ensure that their organizations are agile and resilient in an increasingly complex future, affirms Simon Cushing, Senior Director Analyst, Gartner.
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lobal oil and gas markets are poised between two competing drivers — rising pressure to decarbonize energy provision and increasing demand for energy in developing economies. Executives must find new ways to maintain competitiveness and growth. The unique stresses of 2020 have elevated three business imperatives for 2021 namely optimizing business performance, creating new capabilities and strengthening technology foundations. The 10 key trends in this report, individually and in combination, reflect reformation of the industry in the face of complex growing challenges. CIOs who understand these trends can enable breakout performance that will differentiate them and their organizations in the months ahead.
Trend No. 1: Enterprise capabilities diverge as new business strategies emerge As individual business strategies become more nuanced and differentiated, companies will need novel enterprise capabilities to facilitate implementation. For example, refining companies are exploring biofuel and bioplastics production and deepening their presence in regional petrochemicals products. Oil and gas CIOs will need to
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facilitate these business innovations by incorporating compatible architecture principles in the design of the new enterprise architecture.
Trend No. 3: Digital twins drive transparency and automation Digital twins can deliver value across the business via the increased integration of internal systems, human activity and external ecosystems. A digital twin is a virtual representation that serves as the real-time digital counterpart of a physical object or process. Digital twins are trending because of their capacity to improve the performance of business assets. Digital twins improve operational efficiency, prevent downtime, reduce maintenance and maintenance costs, and allow for more effective collaboration between experts and operators.
Trend No 4: Comprehensive engineering creates intelligent assets To improve outcomes, such as production efficiency, uptime and yield, oil and gas companies are supplementing traditional monitoring and control systems with additional sensors, cloud-based data aggregation platforms, advanced analytics and AI. According to the Gartner 2021
CIO Survey, as many as 50% of oil and gas companies plan to increase investments in analytics, AI/machine learning (ML), automation, IoT and cloud this year. CIOs are responsible for creating intelligent asset capabilities using the increased budgets. third-highest priority for CIOs, and in 2014, there was no specific funding allocated to it. According to Gartner, 85% of CIOs in the oil and gas industry have assumed responsibility for creating a change-enabling technical platform and 79% are working to build a stronger change leadership culture in IT. CIOs will need to reorient themselves toward value delivery by introducing service delivery models that replace cost-based IT silos with value-based IT products.
Trend No. 5: Key vendor partnerships define enterprise platforms Traditionally, oil and gas companies have separate owners for managing IT vendors versus the engineers with whom vendors partner. However, Covid-19 pushed CIOs of oil and gas organizations to reconsider traditional vendor engagement. While oil and gas CIOs continue to take a lead in their relationship with large IT vendors, they are
