How disruption and value migration could undermine the dominance of today’s leading firms
Over the last century, the oil and gas industry has witnessed its share of change and transformation. The breakup of Standard Oil in the U.S. resulted in the formation of large and vertically integrated "oil majors." These firms have dominated the international landscape for many years while recent industry consolidation has given rise to a handful of "supermajors." Widespread nationalization of oil assets, largely in Arab nations in the middle part of the century, and most recently in Latin America, have created state-owned oil companies that by some measures, are larger than their private sector counterparts. Russia's government has reversed course from the "Loans for Shares" programs of the 1990s that led to the creation of the oligarchs to an industry now firmly under state influence with minority participation from foreign investors.
In this report, internationally recognized expert Michael Raynor explores the concept of disruption—a specific kind of innovation that has historically threatened the end of even the most powerful incumbent organizations—and the impact it may have on three segments of the oil and gas value chain: retail, refining, and exploration and production (E&P).
The purpose of this report is to demonstrate at least three areas of the industry that are currently at risk in ways that could result in a significant shift in the relative profitability and even dominance of today's leading firms. By applying disruption theory to their industry, incumbent oil and gas firms may be able to capitalize on changes in market dynamics and become one of the few populations of dominant companies to exploit and even profit from disruption rather than be victimized by it. Learn more from the PDF attachment below.
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