The Digital Transformation of the Oil and Gas Industry

Lux Research:

The oil and gas industry today faces four key challenges: volatile commodities, workforce retirements, low carbon economy, and shifting geopolitics. Culminating in its new era of operational efficiency, digital transformation serves as the answer for cost reduction and revenue increment.

As the industry struggles to successfully scale up digital across global operations, we provide a framework for identifying applications that hold potential for enterprise-wide deployment to avoid scale-up failures. From our analysis, we conclude that while the majority of applications do offer ease of scale-up, not all of them produce high financial gains. A handful of applications instead contribute to other value drivers, such as sustainability.

Moving forward, as the digital transformation of the industry matures, we anticipate more operator-operator digital collaborations, creation of data marketplaces, inception of “tech” oil companies, and disruption of traditional service companies by major software giants.