Crude Oil Procurement Intelligence
In this crude oil procurement intelligence report, we have estimated the pricing of the key cost components. Labor, and material & equipment form the largest cost component of the crude oil businesses. Together, they account for about 60% of the total cost. The cost also depends on the type of infrastructure built, the transportation method used, regional taxes levied, insurance, and the maintenance required for the production of crude oil.
For example, Oil field development necessitates substantial investments, with development expenses ranging from 40% to 60% of the entire project cost. Costs are greatly influenced by key characteristics such as field scenario, target depth, and ocean-meteorological variables. The cost ranges from USD 7 to USD 15 per boe (barrel oil equivalent), with more complicated fields needing greater prices. It is critical for project profitability and project definition to identify and evaluate these parameters. The cost of a horizontal well is 20% to 30% greater than that of a vertical well, but well productivity is improved by a ratio of three. Environmental restrictions might also affect well costs.
Order your copy of the Crude Oil category procurement intelligence report 2023-2030, published by Grand View Research, to get more details regarding day one, quick wins, portfolio analysis, key negotiation strategies of key suppliers, and low-cost/best-cost sourcing analysis
Operational Capabilities - Crude Oil
- Years in Service - 25%
- Geographic Service Presence - 15%
- Key Clients - 15%
- Revenue Generated - 15%
- Employee Strength - 15%
- Industries Served - 15%
Functional Capabilities - Crude Oil
- Oil Exploration - 19%
- Well Drilling - 19%
- Servicing - 19%
- Oil Transportation - 19%
- Refining - 19%
- Others - 5%
Rate Benchmarking
The demand and production levels set by OPEC nations are important factors in analyzing rate benchmarking in the crude oil category. The spot price of crude oil has been volatile in recent years, with significant swings up and down. The highest price was in July 2022, when it reached USD 105.08 per barrel. The lowest price was in April 2020, when it reached USD 21.04 per barrel.
The data shows that the price of crude oil has been on a downward trend since 2014. In Canada, average price per barrel of crude oil in 2022 was USD 118.46 compared to USD 80.21 per barrel in 2021. In Russia, prices of crude oil in January 2022 were at USD 85.19 per barrel up from USD 54.73 per barrel in January 2021. However, due to sanctions imposed on Russia following its invasion of Ukraine in February 2022, prices of Russian crude oil dropped from USD 91.85 at the beginning of the war to USD 56.10 in February 2023.
Supplier Newsletter
In July 2023, ExxonMobil Corporation has announced the acquisition of Denbury Inc., an established provider of carbon capture, use, and storage (CCS) technologies and enhanced oil recovery. The transaction includes Gulf Coast and Rocky Mountain oil and natural gas activities, in addition to Denbury's carbon capture and storage facilities.
In June 2023, Engineering, Procurement, and Construction (EPC) contracts have been given by Aramco and TotalEnergies toHyundai Engineering & Construction Co. Ltd, Maire Technimont and others for the USD 11 billion "Amiral" complex, an expected large-scale petrochemicals plant extension at the SATORP refinery in the Kingdom of Saudi Arabia.
In May 2023, Chevron Corporation signed an agreement with PDC Energy, Inc. to purchase all of PDC's outstanding shares in an all-stock deal valued at USD 6.3 billion. Chevron now has assets of high quality that are expected to produce higher returns in lower-carbon-intensity regions in the United States as a result of its acquisition of PDC.
In April 2023, Shell U.K. Ltd., a subsidiary of Shell plc, finished the resumption of operations at the Pierce field in the UK Central North Sea, after a large upgrade that allowed gas to be produced after the field previously generated only oil for many years.
In September 2022, BP announced the acquisition of EDF Energy Services, which would increase BP's footprint in the US commercial and industrial (C&I) retail power and gas industry. This also opens up new prospects for better lower-carbon comprehensive energy offerings for C&I customers, as well as integration with other BP enterprises and capabilities that can help with decarbonization efforts.
List of Key Suppliers
- Saudi Arabian Oil Co.
- China Petroleum & Chemical Corp.
- PetroChina Co. Ltd.
- Exxon Mobil Corp.
- Shell PLC
- TotalEnergies SE
- Chevron Corp.
- BP PLC
- Marathon Petroleum Corp.
- Valero Energy Corp.
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Crude Oil Procurement Intelligence Report Scope
- Crude Oil Category Growth Rate : CAGR of 3.42% from 2023 to 2030
- Pricing Growth Outlook : 7% - 13% (annual)
- Pricing Models : Spot pricing model, cost-plus pricing model, future price model, OPEC pricing model
- Supplier Selection Scope : Cost and pricing, past engagements, productivity, geographical presence
- Supplier Selection Criteria : Technology, environmental record, financial stability, service, quality, service, reliability, technical expertise, security measures, cost and value, support and maintenance, regulatory compliance, and others.
- Report Coverage : Revenue forecast, supplier ranking, supplier positioning matrix, emerging technology, pricing models, cost structure, competitive landscape, growth factors, trends, engagement, and operating model
Brief about Pipeline by Grand View Research:
A smart and effective supply chain is essential for growth in any organization. Pipeline division at Grand View Research provides detailed insights on every aspect of supply chain, which helps in efficient procurement decisions.
Our services include (not limited to):
- Market Intelligence involving – market size and forecast, growth factors, and driving trends
- Price and Cost Intelligence – pricing models adopted for the category, total cost of ownerships
- Supplier Intelligence – rich insight on supplier landscape, and identifies suppliers who are dominating, emerging, lounging, and specializing
- Sourcing / Procurement Intelligence – best practices followed in the industry, identifying standard KPIs and SLAs, peer analysis, negotiation strategies to be utilized with the suppliers, and best suited countries for sourcing to minimize supply chain disruptions
