How Covid-19 Has Impacted the Oil Industry
Covid-19 is strongly impacting the oil industry and is causing some companies to downsize. We want to let everyone know that SJ Environmental is still moving forward with projects and we are looking for ways to help our clients and the industry bounce back. Here is what is going on.
1. The price of crude oil has decreased
The price of crude oil has significantly decreased. This has done a lot of damage to the stock market. Since there is an enormous decrease in the demand for oil, there has been a lot of concern about over-producing a product that is no longer as necessary as it once was in people’s everyday lives. The Organization of Petroleum Exporting Countries, known as the OPEC, held a meeting with several countries to discuss this issue. As a result, the OPEC countries agreed to cut no less than one and a half billion barrels of oil per day from production.
However, after this meeting, the Organization of Petroleum and Exporting Countries met with Russian representatives, asking that they cut five hundred thousand barrels per day from their production. The Russian representatives did not agree to do so. As a result of this refusal, the OPEC made the decision to increase the production of crude oil until Russian officials would relent. Unfortunately, Russian representatives have still not agreed to their terms.
2. The demand for crude oil has dropped
The demand for crude oil has significantly decreased since people have been forced to stay at home. Since international and domestic travel have been banned, the International Energy Agency has predicted that the demand for crude oil will decrease annually by ninety thousand barrels per day. This will mean that our economy will really struggle because so much of our economy is based on gasoline.
3. Oil rig workers are contracting the disease
An offshore oil rig worker has, unfortunately, contracted Covid-19. He worked for the Norwegian oil company called Equinor. He is now quarantined at home.
As a result, work on the oil rig has continued, but fewer workers are currently available. The company has asked downstream staff to work from home and has enforced travel restrictions. These are the kinds of measures that need to be taken at this time.
4. Companies are enforcing travel restrictions.
Many oil companies are enforcing travel restrictions and asking downstream employees to work from home. Each company is monitoring its employees carefully and making difficult decisions about whether or not to enforce these restrictions.
If you are the owner of an oil company or work for one, this is an extremely difficult time. You want to be safe, yet you also want to continue earning money. Right now, the safety of your employees should be your first priority. Asking people to stay at home when they are sick will mean that everyone who works for your company is protected from the virus. Your employees will thank you.
It is important to remain strong in the midst of social distancing and fear. This will pass. Take all of the precautions that are necessary to keep your employees safe.
We extend our best wishes to all of those who are suffering as a result of Covid-19. We hope this article has been informative and has helped you understand the difficulties that all of us are facing during this extremely trying time. We are going to get through this together.
If you are interested in reducing costs and maximizing profits, Contact SJ Environmental today!