Tag Archives: oil and gas logistics

How the Oil and Gas Industry Changed During the Pandemic

How the Oil and Gas Industry Changed During the Pandemic

The oil and gas industry has historically been resilient, weathering crises, disruptions, and economic downturns. But just like everything else in 2020, the disruptions caused by COVID-19 have exposed weaknesses throughout this sector.

Many factors prepared the soil for disruptive processes, like increasing environmental concern, difficulties with finding young talents, and low investment returns over the last few decades. Mid-year of the pandemic, we see which forecasts came into reality and what challenges are making the most profound impact on the industry as a whole.

What are the key challenges changing the oil and gas industry right now?

1. Demand crunch

Starting in 2014, oil prices began to skyrocket. While supply has grown considerably since then, demand was in decline before COVID and was exacerbated by the global lockdowns in early 2020. Decreased travel and commuting, along with the closure of operations for some refineries and shipping lanes have resulted in a supply glut and demand crunch.

2. Political risks and trade tensions

Global political pressures have also taken their toll on the oil and gas industry and have increased the risks associated with these often international enterprises. Ongoing tensions between the US and China, the EU and Russia, throughout the Middle East, and the uncertainty surrounding this year’s elections worldwide all ripple through the economy and have altered global oil prices.

3. Pressure for environmental concern

Increased public concern for the oil and gas industry’s impact on ongoing climate change has led to intense media and political scrutiny not only on oil and gas as products but on the methods companies use to extract these resources. As of late, carbon taxes have been floated as one way to hold companies responsible for using potentially harmful resources.

Carbon taxes and additional restrictions on oil and gas production will be one of the key challenges for oil and gas companies in the upcoming years. According to a report by Accenture, carbon taxes could boost oil prices from $5 to $8 per barrel of oil equivalent (BOE).

4. Critical jobs decrease

Due to price volatility and the uncertainty caused by the COVID-19 pandemic and international tensions, between March and August of 2020, the oil and gas industry in the US has lost more than 100,000 jobs. This is the largest employment loss in the sector’s history, according to a Deloitte report. The situation is worsening with fewer graduates in the geology and petroleum management fields, possibly due to the industry’s association with climate change. This leads some experts to believe the industry may struggle with staffing shortages long after the current economic climate settles.

5. How can oil and gas companies overcome the current challenges?

Remaining vigilant and aware of changing market conditions, being flexible, and efficiently integrating with reliable partners will work wonders for oil and gas operations in any economic climate.  Despite the economic challenges, PLS continues as a top-tier 3PL in helping our partners in the oil and gas sector to keep their business up and running.

What Will the State of the Oil and Gas Industry Be After Coronavirus?

The oil industry was one of the most severely hurt industries during the coronavirus pandemic. On April 20, oil prices went negative for the first time in the history of the oil market, peaking at -$37.60 per barrel. For comparison, at the start of the year, an oil barrel costs $60. Such a bizarre drop was caused by a huge discrepancy between oil supply and demand. Worldwide lock-downs, drastic air flight shortages, and fewer commuters resulted in a sharp fall in fuel demand. 

Such a quick and unpredictable event has uncovered many far-reaching issues in the core of the oil industry, showing how vulnerable it can be. Even when the stock market has slightly recovered, investors are still aggressively selling oil stocks. Combined with a 30% fall in demand, the whole oil market came to a sudden breakdown.  

While small improvements have been seen, it is quite uncertain when the oil demand will recover to its normal level. Right now, many countries, the U.S. in particular, started to loosen lock-down measures, with some industries slowly returning to a normal pace. However, “normal” isn’t coming anytime soon. 

The main problem for oil companies is that there is too much excess oil, and no place to store it. Roughly, 85% of oil storage is full now, and some production companies even have to destroy the product. Hundreds of oil companies are expected to file for bankruptcy. Many industry experts claim that years of overproduction combined with collapsed demand will result in years of recovering, and low oil prices. 

Many of the large market players have abruptly shut down fields and wells, declaring the situation as “out of the norm” and “force majeure.” Countries-members of OPEC are also forced to cut outputs for the first time in a while. As June contracts are coming due, the issue continues to hurt the market. 

As for what is going to happen with overstock, there are different approaches. Once onshore storage is completely filled, some companies are going to stash oil to deliver it later at a higher price. Some countries, like Russia, are planning to burn excess oil to get by. It is quite uncertain when and how the market will recover, but it surely won’t happen soon. 

Oil and Gas Industry Outlook 2020: What to Expect

2019 is coming to an end, which means it’s time to wrap up the year and define key trends for the oil and gas industry in 2020. Last year was a tense period for the oil and gas industry, and for the U.S. economy in general. Ongoing tension with the U.S. – China trade war, disrupting political situations in the country and beyond, and weakening global markets altogether have brought significant shifts to the oil and gas market. Let’s take a look at the key outtakes from a Deloitte Report.

What to expect in the oil and gas industry in 2020?

Increased security, decreased demand

Due to the trade war, the fluctuating economic and political situation, the recession in GDP growth, and general economic slowdown, the demand for oil and gas products and distribution may decrease in 2020. However, growth in supply from producers in the Western Hemisphere is expected. Due to political tensions, companies will be focusing on increased supply chain security. To avoid potential disruptions and price jumps due to unpredictable situations between oil market players, safety and security will become a primary concern for businesses during the upcoming year. The situation with oil demand and prices is still uncertain.

Energy transition and sustainability

The discussions about the future of energy production seem to be never-ending and filled with uncertainty. While some expect coal, oil, and gas fuel to be partly or fully be replaced by the 2030’s, most experts believe this won’t happen until mid-century. Regardless of the full implementation time, the process of replacement and energy transition has already started. The biggest challenge for companies will be switching and adjusting to a new demand on the market while reducing carbon emission. Becoming more sustainable is also expected to be a major trend in oil and gas for the upcoming years.

LNG export will continue to grow, but not as fast as previous years

Since 2016, the U.S. liquid natural gas exports have grown drastically and haven’t stopped increasing. Due to the low-price market and relatively stable price mechanisms, the U.S. was dominating the LNG export projects market. However, the situation can change in the upcoming years. With more competitors emerging and willing to bring flexibility to the market, it will be more challenging to generate steady growth and maintain ongoing projects.

Read more in Deloitte OGC Outlook 2020

How Technology Can Help Midstream Transportation Companies?

Technology and innovation are changing our world and the way we live. These shifts are affecting every single industry, and the energy industry is one of the most influenced branches of the global economy. Upstream, midstream, and downstream sectors all require digital transformation for efficient operations and cost reduction. For midstream transportation, digitization plays an even more crucial role, as a large chunk of costs are spent on oil and gas transportation.


Although many oil and gas companies take efforts to digitize pipelines, there is still a lot of work to really digitize midstream transport. Blockchain, data technology, tracking, and other innovations could drastically reduce transportation costs, and increase performance efficiency. Making the process of midstream transportation clear and transparent will help to better analyze and store data, define gaps, and drive results for energy companies. In particular, blockchain is believed to be the most promising and capable innovation to optimize and automate the midstream sector.

How blockchain and technology can help midstream transportation companies?

Infrastructure streamline

One particular thing about oil and gas midstream business is its incredibly complex infrastructure. Numerous spots in remote locations have different characteristics and specifications, which makes it complicated to manage. Advanced use of blockchain lets companies store and sort all the necessary infrastructure data in one place, which makes the process of midstream transportation management simpler and way more efficient.

Transportation tracking

Another crucial feature that could eliminate mistakes and costs in the oil and gas business is proper transportation tracking. Transparency of the energy supply chain lets companies see potential risks, discrepancies, inefficient operations, and performance gaps. This way, midstream companies can better understand how transportation looks like in real-time, and define better routes or methods for moving crude oil or natural liquid gas.

Equipment condition tracking

Tracking can also include monitoring of the pipeline’s climate. In terms of risk management, equipment condition control plays a critical role as a safety measurement. Oil and gas are not always transported through pipelines alone. Trucks, barges, rail, and the combination of modes require even more attention and monitoring.

Ultimately, blockchain and other innovations are much needed in the midstream sector, as well as in the oil and gas industry in general.

Midstream Transportation with PLS

Looking for oil and gas shipping services? Check out our energy transportation solutions!

Midstream Transportation Trends: The Future of Oil and Gas Industry

Despite the 2014 oil and gas price drop crisis and the rush around alternative fuel sources, the future of the oil and gas industry remains bright and has a steady pace of growth and increasing demand. More than four billion metric tons of oil and produced every day worldwide, with oilfield companies still generating the biggest revenues. Experts estimate that by 2030, the world population will reach 8.5 billion. This means humanity will need a convenient, reliable and safe source of supplying our everyday life with energy.

What is the future of the oil and gas industry?

Midstream transportation plays a crucial role in oil and gas distribution and storage, and, therefore, in the industry’s future. There are many challenges that the midstream sector needs to resolve. Environmental impact, streamlined transportation, and technology investments are the key concerns for the oil and gas transportation industry. The high demand for oil and gas supplies puts companies under the pressure of staying up-to-date with the latest trends and constantly enhancing their technology. To understand where the entire industry is going, let’s take a look at the key trends in the future of the oil and gas industry:


Essentially, there’s no progress without innovation, regardless of the industry. Midstream transport is the bridge between oil production and distribution, therefore, the efficiency of fuel transportation defines the supply chain flow. Transparency and speed are crucial for a robust transportation strategy, and that’s why midstream companies need to implement automation. It lets companies increase productivity, gain more visibility into operations, store data efficiently and streamline processes. Investing in reliable and powerful software will become a top-priority for oilfield companies.

More collaboration

Oil and gas sector shifts to being more cross-industrial and collaborative. This means that flexibility will enter employment, business model, and partnerships with other businesses. Companies will drift away from rigid employees’ departments to outsourcing and project hiring. In the nearest future, hiring a niche specialist for a certain project will bring more value than an in-house team handling all the processes. The oil and gas will become more flexible and collaborative in terms of working with other companies, too. Better communication and cross-industry projects are gaining more and more use, and this trend will remain growing.

Embracing the growth of renewable options

Let’s face it… no matter how much talk there is around alternative energy sources, fossil fuel won’t be fully replaced within the next 100 years, if not more. Many oilfield companies see these innovations as a threat, however, a much more efficient and mature way of dealing with it if embracing the fact that the process of switching to renewable energy sources has already started. For now, fuel is not going anywhere. That means oil and gas companies should focus on how to increase their global presence, strengthen safety, reduce environmental output and integrate into the new order.

Oil and Gas Transportation with PLS

PLS is one of the country’s leading industrial-focused 3PL providers. We can handle your oil and gas supply chain with our dedicated team, skilled carriers and committed capacity. Learn more about our Oil and Gas Shipping services!

3 Main Challenges of Oil and Gas Industry

The oil and gas industry is extremely volatile by nature. It is involved with many other industries and processes, and often must adjust to the dynamic environment. At the same time, upstream, midstream, and downstream oil and gas appear to be extremely complex and require a high level of management and responsibility to function properly. This puts oil companies under the pressure of high-quality maintenance and being flexible at the same time. Apart from traditional obstacles like fluctuating oil prices that cause spikes and drops of demand, there are a few other significant challenges.

Oil and gas industry challenges

Reducing costs

In oil and gas, reducing costs means optimizing processes as much as possible. It is an extremely complicated mission to reduce production costs and still maintain proper quality levels. Therefore, constantly monitoring operational processes and defining gaps is crucial to keep costs down.

Visibility into operations

With such a complex supply chain, it is a huge challenge for oil and gas companies to stay updated on everything happening within the business. Lack of transparency into operations and processes often results in disruptions and overspending. The key to overcoming this obstacle is investing in innovative software with rich functionality and integration capability. Real-time updates and data storage lets you see a wholesome picture and easily monitor every separate operation.

Improve communication with service parties

Obviously, oil and gas companies could hardly operate without any parties involved. From vendors and suppliers to logistics providers and customers, clear communication is a must at every stage. Outline a strategy and make sure to clearly communicate it to your partners. Emphasizing your company’s updates and changing needs will help speed up processes and increase performance efficiency.

Oil and Gas Shipping with PLS

PLS is one of the country’s leading industrial-focused 3PL providers. We can handle your oil and gas supply chain with our dedicated team, skilled carriers and committed capacity. Learn more about our Oil and Gas Shipping services!

Midstream Oil and Gas: What Is It & How Does It Work?

There are three essential stages in the oil and gas production industry: upstream, midstream and downstream. To understand the role of midstream oil and gas, let’s take a look at every stage.

Upstream is referred to all of the processes and actions connected to finding, exploring, drilling and producing crude oil and natural gas. Obviously, midstream is an intermediate link between the first and the last grade of the oil industry. As a final link, downstream encompasses refining and selling end products of oil and gas segment.

What is midstream oil and gas?

Consequently, as a median link between upstream and downstream, midstream is responsible for storing and transporting oil and gas supplies to their end distributors. It includes all the processes, equipment and facilities needed to distribute the materials.

It may seem like the easiest process, but it is way more complex than many can imagine. Arranging storage and logistics of fuel materials requires following safety guidelines and complying with strict regulations. Shipping speed also plays a crucial role in the oil and gas supply chain, which makes midstream transport an important branch to manage.

How does midstream supply chain work?

Oil and gas supply chains are very complex. There are many different processes within the stage of midstream oil and gas. Usually, it consists of three main stages:


Storing oil and gas plays a huge role in balancing supply and demand of the materials across the country. It is a part of midstream to secure supplies in large oil tankers and to prepare materials for distribution.

Primary logistics

Once crude oil or natural gas is ready for transit, the logistics stage begins. Primarily, most of oil and gas is transferred with special pipelines that are built across the country. Highly secured and protected, oil is pushed with an extremely high pressure to reach the necessary destination. Midstream pipelines are the best way to move energy products safely and quickly.

Secondary logistics

Essentially, when the supplies arrive at the hub, the next step is the delivery to a final destination (warehouse, plant, or facility). There are several transportation modes like trucks, rail, and barge that assist midstream companies with this task. It is a critical stage of transportation and requires proper planning and execution.

Midstream Transport: Oil and Gas Shipping with PLS

PLS is one of the country’s leading industrial-focused 3PL providers. We can handle your oil and gas supply chain with our dedicated team, skilled carriers and committed capacity. Learn more about our Oil and Gas Shipping services!

Oil and Gas Safety: 3 Practices for Safe Transportation

The oil and gas industry essentially involves exploring, utilizing and transporting hazardous materials. Therefore, oil and gas safety compliance and risk management are crucial in such a complex sector. Unfortunately, disruptions and breakdowns in oil and gas supply chain lead to devastating consequences, that apart from an environmental disaster often causes numerous injuries and death cases.

Risk management in the oil and gas industry has to be handled properly. However, it doesn’t always work the right way. Sometimes, companies may underestimate the importance of safety measures while exploring and transporting crude oil and gas. It is critical to regularly check if your operations are in compliance with safety guides.

3 Practices for Oil and Gas Risk Management

Risk management strategy

In the oil and gas industry, preventing an issue is much more important than solving the consequences. That’s why proper project analysis and forecast of all dangerous situations is essential for the risk management strategy. Potential issues can occur on every stage of the process. So, it is important to outline all the possible scenarios before the execution begins.

Operational safety control

Unfortunately, the majority of accidents in the oil and gas industry are the result of human error. The first step to ensure safety compliance is developing a proper safety culture. Often, company leaders dismiss small signs that later might lead to an unwanted outcome. Also, make sure that employees that are responsible for operations and safety measures are doing it on practice, not just in their paperwork reports. Companies certainly should pay close attention to any changes in the system or processes.

Proper communication and analysis

In industries like oil and gas, it always seems like the disaster occurs randomly and with no possibility to be predicted. However, after some time of analysis, many minor warnings of danger come to the surface. Despite these factors were known, there was no proper communication or the importance of them was just underestimated. Make sure to structure the efficient communication strategy within the company and with all the parties involved to diminish the risks.

Ultimately, regular control and accurate planning can reduce the risk rate to a very low level. It’s better to be safe than sorry, especially in the oil and gas industry, where being sorry costs a very high price.

Oil and Gas Shipping with PLS Logistics

Learn more about our Oil and Gas shipping services to ensure safe transportation!

4 Best Transportation Methods for Oil and Gas Shipping

It is hard to imagine our lives without fuel. Every day, we rely on the oil and gas industry to supply us with energy to keep multiple processes running. In order to provide us with necessary materials like oil and gas, companies must ensure they transport it in a convenient and reliable way. Choosing the right transportation mode and a robust strategy is crucial for efficient oil and gas shipping.

The role of transportation in the oil and gas industry

Transportation is an essential part of the oil and gas industry. However, due to the hazardous nature of transported products, it can be complicated. Crude oil, natural gas, and oversized drilling equipment all require special handling and increased safety regulations. Therefore, cargo security, delivery speed, and proper transportation equipment play a significant role in the oil and gas supply chain.

To ensure successful delivery, energy companies use various modes of oil transport. Sometimes, it can be challenging to choose the proper mode.

Here are some of the most popular ways of transporting crude oil and gas across the world:


The easiest and most utilized form of transportation in the oil and gas industry is trucking. With on-the-road transportation, you can schedule shipments at any time and move them at any place. This advantage makes trucking way more beneficial than other transportation modes. Also, it moves smaller amounts of oil, meaning that the extent of damage in case of cracks or leaks is relatively small.

Additionally, there are various types of trucks that can perfectly suit the needs of the industry.

  • Flatbeds are open trailers that are commonly used for oil and gas equipment shipping because they let you move loads of any size and shape. Rigs, pipes, and drilling equipment are usually oversized and overweight, which makes it hard to move via any other transportation method except a specialized truck.
  • Hotshots are trailers connected to a pick-up truck that is made for moving small and urgent shipments. Whenever you need to quickly transport a piece of equipment to a remote site, hotshot is a perfect option.
  • Oil tankers are special cylindrical containers connected to trucks. Tankers are adjusted to moving liquids, and they are good for moving oil as well. Although you cannot ship a large volume of oil through the truck, the vehicle can take it to any destination you need.


This transportation method suggests that oil is gathered and then transported directly to the site or plant via a pipeline network. Despite pipeline shipping being a hot topic of discussions between industry experts, it is a fast and reliable way to distribute oil. New technology helps advance the safety of this mode, and pipelines have sensors for monitoring important indicators like temperature, pressure, etc.

Pipeline transportation has its disadvantages. Firstly, it limits areas and destinations you can ship to because the pipeline infrastructure is not developed enough. Additionally, pipelines move enormous amounts of oil, so when an accident happens, the damage is very serious and it’s often hard to liquidate the consequences.


Ships are a slow, inexpensive, reliable way to move extremely large volumes of fuel. Ocean transportation has one big advantage over other shipping methods, which is that you can transport materials globally. Despite longer transit, it is the most efficient mode for moving oil across the world. Essentially, ocean shipping is mostly used as a part of a large intermodal strategy.


Rail transport was a primary way to move oil for more than 150 years. Rail transportation makes oil containers less prone to damage compared to other shipping modes. This method doesn’t have enough flexibility to move oil at any point. But, when combined with other modes, rail can be extremely beneficial for a fairly fast and cost-effective way to move oil long-distance.

Oil and gas transportation with PLS

Regardless of the shipping method you choose, it is essential to find a reliable transportation provider. At PLS, we have more than 27 years of experience and providing logistics services for oil and gas companies across North America. We can help you enhance your transportation strategy with our customized solutions, 45,000 carrier network, and a variety of modes.

Learn more about our oil and gas transport services!

The 3 Main Oil and Gas Trends In 2019

Over the last few years, the oil and gas industry has faced numerous shifts and fluctuations, along with extreme price volatility. Technology, new energy policies, and trade agreements continue to affect the industry. The industry should expect to see even more transformation in 2019 and beyond. We have collected some valuable insights from the energy industry forecast and highlighted the main oil and gas trends in 2019 and beyond.  

Natural gas demand will increase

In fact, natural gas consumption is growing almost 3 times faster than oil consumption. Lately, companies have been promoting natural gas as a suitable and less polluting alternative. For now, natural gas accounts for 25 percent of the overall energy consumption. Also, experts forecast a 1 percent market growth until 2050.

The shift towards renewable energy sources

Many industries have experienced a huge shift because of sustainable and environmental movements. Oil and gas are considered one of the most harmful industries, however, the green shift has made its impact here too. One of the major oil and gas trends is switching to renewable energy sources. International Energy Agency (IEA) states that the renewable energy industry is anticipated to increase 13 percent until 2021, while the overall global demand for low carbon energy sources has jumped 85 percent. Large energy companies seek partners who will help them adjust to the industry shift and implement sustainable practices.

Technology impact

Innovations are making a substantial impact on the energy sector. In the oil and gas industry, digitalization works in the form of processes optimization, secured payments, advanced analytics, operational efficiency, and sales. According to Worldwide Oil and Gas 2018 Predictions, nearly 75 percent of oil and gas companies will deploy at least one innovation. Ultimately, big data, cloud services, IoT (Internet of Things) and software will drive efficient solutions into the energy sector over the next few years.

Bottom line

Presumably, innovations and sustainable fuel are not the only game-changers in the industry. Traditional factors, like OPEC output, oil supply and demand, changes in energy policy, and workforce challenges are making the largest impact on the industry. However, the oil and gas sector is surely going to adapt to the changing economic environment.

PLS Logistics provides efficient supply chain solutions to oil and gas companies. Learn more about our Oil and Gas services and get a free quote now!