National Oil Companies are not only becoming more international in nature, but also more integrated, investing in refining and petrochemicals both at home and abroad. The role of national companies in the world oil industry has become more emphasized due to the ownership of huge resource base and the production of hydrocarbon substances, which help to expand the vital role of national oil companies in securing adequate supplies to the world to maintain energy demand, sustainability, prosperity and growth.

With the fall in demand and the collapse in oil and gas prices, the oil industry is faced with many challenges. These include: the security of supply and investment required; security of demand; oil-price volatility and transparency needed; cost inflation; the talent shortage; and climate change. The continuous series of discussions will eventually lead to enhancing co-ordination and co-operation of all players and ensuring adequate energy investments and technology co-operation.

The current global financial crisis has created opportunities to enhance stronger co-operation and co-ordination based on mutual benefit among national and international oil companies. The current situation has created an environment to unite efforts to overcome such hard times. It has pushed forward the challenge of financing of necessary infrastructure and technology projects, given the fact that the industry would be seriously affected in case of cancellation or even delay.

A consensus view of projections indicates continuous global rise in demand for fossil fuels and the dominance of hydrocarbons as the energy source over the coming decades. However, growing demand uncertainty increases producers’ perceptions of investment risk.

As the balance of supply and demand shifts, the benefits of partnership between NOCs, IOCs, and service companies become more compelling – to rethink existing models and develop new models of partnership.

NOCs of energy import-dependent countries are adopting more aggressive foreign expansion plans, to encourage the build-up of grass-roots refineries and upstream exploration. Improved accountability and transparency, regulatory compliance and corporate governance can help to access new markets and ensure sustained industry growth.

The oil industry would continue to heavily invest in the areas that would promote cleaner hydrocarbon energy to maintain its position in a carbon-constrained world. Spending on R&D and in the development of more efficient and clean technologies, specifically in new energy technologies such as carbon capture and storage is one area where NOC and IOC co-operation can easily be paved.

A skillful workforce is an essential requirement for oil industry, since projects are becoming more complex and management is becoming more difficult. Human resources, learning and development are therefore becoming increasingly important. This can easily be met by the right joint ventures, partnerships and technical service agreements.

Shared responsibility between producers and consumers could help in addressing future challenges and reducing anxiety in the market.

Closer co-operation between governments, their agencies and international oil and gas companies is the key for sustained energy security. While producer governments have to ensure that the right conditions exist for long-term investments, business must adapt to the new realities and seek new solutions to fulfill their part in achieving energy security.