John Ballantine Jr.

Our energy worlds have experienced more uncertainty since the1973 OPEC embargo, the Iraq Wars, or 2015 Paris Climate agreements. Oil & gas remains the dominant source of energy as demand shifts and suppliers make huge investments in our evolving energy system. How do today’s players make their investment decisions and prosper in the long run?

The oil industry has faced a whirlwind of exogenous surprises over past decade: financial crises, changing climate agendas, regional conflicts, and the pandemic. However today much of the turbulence is generated within the oil industry: divergent producers operating with different investment parameters. Shale oil in the Midwest with shorter paybacks and lower development costs, compared to the Middle East and OPEC producers, or the North-Sea operators with huge investments, low break evens, and decade long returns. Today's oil & gas sector is characterized by players with dissimilar capabilities operating in a less well-organized market where they are the source of cyclicality and price volatility.

In this webinar, we discuss how an agent-based model brings more realism to the production and investment behavior than macro scenario models.

we focus on the heterogeneity of producers and why this results in different investment behavior
we show what this means for oil market imbalances due to lagged producer responses to demand changes and technology innovations