It is fair to say that the oil and gas industry has seen more than its fair share of difficulties over recent years. The global economic crisis and a slump in oil prices have combined to see more than 120,000 job losses in the industry, and just as some commentators began to note some signs of recovery, the latest concerns over Brexit implications have thrown the industry into further uncertainty.
Yet if the signs from across the Atlantic are anything to go by, we could be on the cusp of a genuine renaissance in the oil and gas sector. As oil prices start to climb, the oil majors are once again ploughing investment into exploration and production, and projections from Goldman Sachs predict that the US industry will be looking to hire at least 100,000 new workers between now and 2019.
We all know that where the US leads, the UK has a tendency to follow, and industry experts are cautiously optimistic that overall sector trends will outweigh regional uncertainty over tariff rates in post-Brexit Britain.
The US Perspective
Ever since the oil bust of the 1980s, those in the know have been warning that the hundreds of thousands of layoffs could come back to haunt the industry due to a shortage of mid-level career workers. Today, America is recovering well from the most recent downturn, and is seeing unemployment at the lowest rate in the past ten years. This means that the oil majors could face real difficulties filling the roles that are now opening up, which is good news for prospective candidates.
Impact on the UK
The global oil price has a complex effect on the UK economy as a whole. On the one hand, you might suppose that a rise is bad news – after all, it will surely have a direct impact on the price you pay as you shop around companies such as Super Saver Oil to get the best price on your central heating oil.
It also has a direct impact on petrol and diesel prices, and we all know that as these rise, so do the prices of consumer products and groceries that rely on road transportation to arrive on our shop shelves.
Yet at the same time, a rise in oil prices can be a great contributor to boosting the economy by revitalising the sector and generating new employment opportunities for thousands. As the value of oil increases, the potential benefits of finding and extracting new reserves also rise, leading the oil majors to invest more money in their exploration and production activities.
This is exactly what is being seen in the States, and the possibilities are high that a similar trend might arise in the North Sea oilfields that have seen dwindling investment during recent years.
In the long term, a buoyant oil industry spells good news for everyone, and could be exactly what is needed to brighten up the economic prospects in the wake of post-recession uncertainty.