Analysis by Energy Workforce President Tim Tarpley
This week began with more uncertainty and conflict in the Middle East. After President Trump announced a plan to begin to escort commercial ships through the Strait of Hormuz, the Iranians began to increase aggressive actions in the region, threatening the fragile ceasefire. Drones were used to target energy infrastructure in the UAE, and a series of aggressive actions were taken against American ships in the region. At the time of writing, the ceasefire is officially still on; however, there is considerable uncertainty about the truce’s long-term future. Adding to the confusion and uncertainty, it is increasingly hard to get any reliable information out of Iran, and it is unclear as to who is really in charge and speaking for what is left of the Iranian regime.
With an endgame in the region increasingly unclear, it is becoming more evident that there may be many months of disruption. A quick end to hostilities may not be in the cards. What does this mean for OFS? Our companies are already seeing a measured but noticeable increase in activity in the Permian and other US basins. Additionally, an increased focus on North and South American oil and gas production as a buffer against global instability is becoming more important. Venezuela, Guyana, Argentina and Brazil appear ready to jump on the opportunity. Production projections by the major operators in Argentina and Brazil tell the story. If those projections hold, there will be significant opportunities for service companies in those regions.
EWTC held a series of impactful meetings this week in and around OTC, and the message was clear: the OFS sector is a vital part of the overall energy picture, and as geopolitical winds change, we need to remain nimble and work to find new opportunities. EWTC will be working on many international projects and opportunities for our members in the coming months and will continue to help identify opportunities as they arise.
Tim Tarpley, Energy Workforce President, analyzes federal policy for the Energy Workforce & Technology Council. Click here to subscribe to the Energy Workforce newsletter, which highlights sector-specific issues, best practices, activities and more.
