The future of oil and gas Essay Example

The roots of the oil industry can be traced back to Pennsylvania and the Caspian in the 19th century while subterranean mining has been known since ancient times. Energy and petrochemical products are critical components of modern lifestyles, with their absence significantly altering it. Production is just one facet of upstream operations; locating, extracting, transporting oil to refineries is vital for success as an exploration organization. Demand from derivative products drives demand but supply shocks have led to price changes (Inkpen & Moffett). Historically, four categories contribute to volatility in prices which cause rapid shifts in supply - including massive new discoveries like those made in Texas during the 1930s resulting in falling prices below production costs.Throughout the 1970s and 1980s, OPEC took action to limit collective producer output in response to rising market demand and political pressure. This led to an increase in prices once again. Additionally, man-made destruction resulting from conflicts such as the Arab-Israel conflict or Persian Gulf War of 1991 also had a significant impact on energy consumption and drove prices up. The effects of natural disasters like Hurricane Katrina were also felt when production facilities off Mexico's Gulf Coast were destroyed, leading to a rise in market price. All these factors have contributed to an ongoing cycle between scarcity and sufficiency as global demands continue to increase. It is widely believed that oil and gas are commodities with worldwide reach, and companies have a critical responsibility to promote sustainable economic growth by ensuring that the production and consumption of these resources are balanced.