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Have Oil Prices Benefited the Gulf Coast Downstream Market?

- David Waterfield. Regional Director, Americas

August 2014 marked the beginning of a steep decline in oil prices and the beginning of a new era of belt-tightening and cuts across the Oil & Gas industry.

One year later, Oscar Energy looks at how the drop in oil price has affected the Gulf Coast downstream industry, amid endless discussions of cost-cutting and survival among upstream and midstream oil and gas companies.

Low oil prices have not hurt US refiners. Far from the job-cuts and negativity troubling producers, downstream companies are benefitting from access to cheaper crude, and according to Standard & Poor’s 500 Index, the top four performers in energy over the last few years have been downstream companies.

Houston-based Marathon Petroleum and Phillips 66 have both enjoyed stellar recent performances from access to additional production coming from US shale plays.

Whilst CAPEX has been slashed amongst upstream producers, Gulf Coast downstream projects are enjoying a boom. SASOL’s Ethane mega-project is just one of several multi-billion dollar projects currently in planning or execution on the Gulf Coast.

The result is a transfer of focus for many service providers - and many employees.

Many downstream companies are utilizing the transferrable skill sets from their upstream counterparts and opportunities for those reliant on the energy sector still exist – just in a different place.

There is light at the downstream end of the pipeline.