GIQ STUDY: COVID-19 Pandemic Should Accelerate Middle East Energy Industry Towards a Digital Tipping Point

By Gulf Intelligence

GIQ STUDY: COVID-19 Pandemic Should Accelerate Middle East Energy Industry Towards a Digital Tipping Point

Dubai, May 31st, 2020 (Gulf Intelligence) – The economic demand destruction triggered by the Covid-19 pandemic should propel the Middle East energy industry to accelerate its adoption of the 4th Industrial Revolution digital toolbox and embed greater operational efficiencies, a group of industry technology experts agreed in a new study by the energy think tank Gulf Intelligence.   

The global energy sector, and the Middle East, in particular, have been slow adopters of digital transformation strategies, which offer a new chapter in human development, enabled by extraordinary technology advances that commensurate with those of the first, second and third industrial revolutions. The speed, breadth, and depth of this revolution is forcing all industries to rethink how organizations create value.

“It’s a tipping point for the industry for a variety of reasons,” Sir Mark Moody-Stuart, a member of the Board of Saudi Aramco and the former Chairman of the Royal Dutch Shell PLC, said in the GIQ Study. “This is a point where oil transforms into a normal commodity, like iron, nickel, and copper, where low-cost producers dominate in market share and the higher-cost producers fill in the tail end – this has been coming for some time, but Covid-19 accelerated it,” Sir Mark said.

Global investment in the energy sector is expected to plunge 20% this year, or by almost $400 billion, compared to last year as the pandemic takes a beating on the energy sector, the International Energy Agency reported last week. Before the pandemic, the global energy investor sector was on track for growth of around 2%, which would have been its largest annual rise in spending in six years. 

Gulf Intelligence, a UAE-based strategic communications & research firm, today published a GIQ Study – Middle East Energy Technology Dialogues – on how the COVID-19 pandemic will impact the Middle East’s energy sector’s adoption of digital technologies, such as artificial intelligence and robotics. The Special Report profiles a series of contributions from 16 digital experts in leading energy technology companies such as ABB, BASF, Halliburton and Schneider Electric to name a few.

“The adoption of the 4th Industrial Revolution digital toolbox in the oil and gas industry – globally, I think I would score 4IR adoption at about 7 or 8 out of 10. In the Middle East, I would say they are coming to 5 or 6 out of 10 because they are now getting more serious about it,” Dr. Satyam Priyadarshy, Technology Fellow & Chief Data Scientist, Halliburton, said in the report.

Gulf oil producers have announced a series of austerity measures since crude prices have more than halved in value since the start of the year. In alignment with this the region’s national oil companies, including Abu Dhabi National Oil Company, have notified contractors and suppliers that they will review existing deals to find ways to cut costs due to the steep slide in oil prices.

Digitalization is already improving the safety, productivity, accessibility, and sustainability of energy systems. It is changing markets, businesses, and employment. New business models are emerging, while some old models may be on their way out. “While the world is going to be very, very different post-COVID-19, the only thing we don’t know is how different it will be. I expect we will see a massive acceleration in the digitalization of the Middle East power sector, a huge improvement that will represent a step-change as we go forward,” said Paddy Padmanathan, CEO of ACWA Power.
                                                                                                                         
 The full SPECIAL REPORT TECHNOLOGY STUDY can be accessed on the following link: http://www.thegulfintelligence.com/en/intelligence/special-reports

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IndraStra Global: GIQ STUDY: COVID-19 Pandemic Should Accelerate Middle East Energy Industry Towards a Digital Tipping Point
GIQ STUDY: COVID-19 Pandemic Should Accelerate Middle East Energy Industry Towards a Digital Tipping Point
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