Igor Makarov
Pexels/Erik Mclean

For centuries, oil and natural gas have driven global economies and people's everyday lives, powering industries, fueling vehicles and bringing mobility to billions. According to recent data, the worldwide oil and gas market grew from $6,989.65 billion in 2022 to $7,330.80 billion in 2023, with a compound annual growth rate (CAGR) of 4.9%.

Today, international businessman from Cyprus and oil and gas expert Igor Makarov delve into the changing dynamics of the oil and gas sector, offering insights into its future.

Post-Pandemic Resilience

The aftermath of the global pandemic has affected industries worldwide, and the oil and gas sector is no exception. Though the industry has slowly recovered, it still navigates the consequences of disrupted supply chains and unpredictable demand patterns. With the new geopolitical tensions, conflicts and the looming shadow of global inflation, the industry is again amid unparalleled change that challenges its resiliency and adaptability.

According to Makarov, these uncertainties call for urgent strategic recalibration. The situation gave energy companies a tangible experience of prevailing conditions in a contracting market, offering more profound insights than any scenario analysis. It opened discussions about forward-thinking, recognizing the need to address the vulnerabilities revealed during the pandemic, ensuring they are better equipped for future peak oil demand scenarios.

"The pandemic was a health crisis that changed the world," Makarov explains. "It compelled the oil and gas sector to re-strategize, adapt to emerging realities and devise innovative solutions to meet the challenges head-on."

The Oil and Gas Automation

Like any other industry, the oil and gas industry is in the digitalization age, witnessing a transformative shift with automation. According to data, automation and control systems used within the oil and gas industry are expected to reach a staggering $41.8 billion market value by 2030, from just $26.87 billion in 2019.

Today, the sector leverages artificial intelligence (AI) to explore and utilize digital platforms in streamlining operations. Makarov points out that technology in the oil and gas industry will be an accessory to refine contemporary procedures, enhance global collaboration and utilize data-driven insights for informed decision-making.

Makarov also emphasizes that with the increasing demand for oil and gas, especially in developing regions experiencing population surges, automation becomes even more pivotal. It will simplify the intricate extraction, transmission and refining processes, significantly boost productivity, curtail costs and ensure heightened safety.

Given that many oil and gas wells are situated in remote and hazardous locales, Makarov sees how automation emerges as a game-changer that will minimize human exposure to risks and optimize operations in these challenging terrains.

The industry's future is intrinsically linked to its ability to embrace and integrate technological advancements. Makarov points out, "In today's world, technology stands at the heart of operations. Immediate collaboration in our globally connected environment is essential, not optional. Technology serves as the conduit for this worldwide collaboration."

Pioneering a Sustainable Oil and Gas Industry

Historically known for its massive carbon footprint, the oil and gas industry is transforming significantly, driven primarily by external pressures. From stringent government regulations, incentives and subsidies to evolving consumer expectations, changing cost structures and rapid technological advancements, the industry is rethinking its traditional operational methods.

Makarov discusses that one of the primary focuses of the industry's sustainability efforts is to reduce methane leaks. Countries like Turkmenistan are currently making strides to address and mitigate their greenhouse gas (GHG) emissions by 2030, with a growing emphasis on the greater use and production of renewable energy.

As the world shifts toward cleaner energy sources, oil and gas companies continue to explore opportunities to diversify their portfolios. The expert also says this includes increasing investments in wind, solar and other renewable energy sources, expressing their commitment as responsible stewards of the environment while remaining relevant and competitive in a changing energy landscape.

This initiative is championed not just by oil and gas companies and international organizations like the United Nations. Together with the International Finance Corporation (IFC) and IPIECA, a global oil and gas industry association for environmental and social issues, the United Nations launched Atlas as a platform that aims to discuss how they can and does contribute to the SDGs at all stages of the oil and gas lifecycle at different project levels.

However, Makarov also wants to stress that sustainability has challenges. As these companies diversify, improve operations and integrate renewable regulations, complexities and struggles may arise. A recent article from Forbes mentions that 50% in operations is a significant barrier to achieving their sustainability goals.

Makarov believes this consideration opens a more extensive discussion about whether green energy is attainable and at what arrangements and policies without compromising all parties involved.

The Industry Future of Innovation and Foresight

While the oil and gas industry remains a pillar of the global energy scene, it constantly struggles between obstacles and opportunities. As Makarov highlights, the sector's future hinges on its adaptability, technological integration and commitment to sustainable practices. The challenges, from geopolitical tensions to the demands of a digital age, are plenty. Yet, the industry's proactive strides toward automation and a renewed focus on sustainability signal a promising future.

As nations and industries worldwide grapple with the pressing need for cleaner energy solutions, the oil and gas sector's evolution is a testament to the power of innovation, collaboration and foresight.

Makarov concludes, "The journey ahead may be complex, but with strategic recalibration and global partnerships facilitated by technology, the industry will be able to navigate the challenges but also redefine its role in a sustainable future."

About Igor Makarov

Igor Makarov, a businessman from Cyprus and a former professional cyclist, ventured into new business territories after selling ITERA and its oil and gas assets in Russia in 2013. In 2015, he founded ARETI International Group, a European-based international company. Under his guidance, ARETI expanded its investments globally, deliberately avoiding business ties in Russia. With offices in Cyprus, Switzerland and Turkmenistan, ARETI invests in various sectors, prominently investments in the oil and gas industry, and actively participates in global cycling development and charitable projects.