In recent years, the global oil and gas industry has been hit with environmental regulations and laws limiting its ability to thrive in the ever-changing global marketplace. However, there is good news for companies willing to take the leap and explore oil and gas outsourcing. Whether outsourcing specific processes, like accounting or bringing production into a new country, the petroleum industry is no stranger to utilizing the benefits of outsourcing. Many countries around the world have friendly business climates for companies in the oil and gas industry, making it the right time to look into this common practice.
State of the Oil and Gas Industry
Since 2008, the U.S. oil and gas industry has been battling the government and employees in an attempt to get approval for the TransCanada Keystone Pipeline oil project. With concerns surrounding the potential environmental implications of the pipeline, the controversial project has been met with protests and petitions, delaying the construction. Despite recent approval of the pipeline by President Trump, the project continues to face scrutiny and barriers as it tries to keep oil production domestic.
This recent back and forth in the U.S. is a prime example of the state of the global oil and gas industry. Lately, the oil and gas industry in the U.S. has seen a steady downturn, mirroring the same trends present across the globe. According to the Oil and Gas Journal, recent economic growth in both emerging and developed markets suggests an expected increase in oil consumption. They predict that production and demand for oil and gas will balance out in 2017 and 2018, leading to a healthier market.
Despite a slow resurgence and growing optimism in recent months, the volatility of this industry has proven that companies need to think outside of their current comfort zone in order to remain competitive in the coming years.
Oil and Gas Outsourcing Across the Globe
Although the Middle East is the first region people associate with the oil and gas industry, Africa’s market for this resource should not be ignored. For instance, countries like Ghana, Tanzania, Mozambique, and Uganda have all unearthed new reserves in recent years. This does not even include the giants of the continent, such as Libya and Nigeria, which rank in the top ten in global oil and gas reserves. Coupled with some of the lowest employer burdens around the globe, Africa is progressively becoming a = popular market for many companies looking toward global expansion.
For companies that want to remain in the more robust oil and gas market of the Middle East, countries like the UAE, Qatar, and Saudi Arabia all boast a healthy market for oil and gas. In addition, this region is becoming increasingly business-friendly, offering a straightforward tax framework as well as growing economies in multiple Middle East countries.
According to PWC, the oil and gas industry can expect a recovery during 2017 and 2018, making it once again a thriving industry. For companies that want to stay on top as the industry continues to grow and adapt to changing views, oil and gas outsourcing is the answer. This can open doors for companies in new markets and provides them will a fallback should the outlook in one market shift. Going global in the oil and gas market is not only a way to explore new opportunities, but necessary for companies to ensure continued growth in the decades to come.
If you’re in the business of making the lights turn on or getting cars to run, but are concerned about taking your business into new markets, contact Velocity Global today. We can explain your options for oil and gas outsourcing and help you take your valuable business into the right markets successfully.