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Market Update: Oil & Gas - December 2018

Market Update: Oil & Gas - December 2018

A closer look at the effects of HR transformation in the oil and gas industry.

Robert Bolton

Head of Global People & Change Center of Excellence, KPMG International; Partner

KPMG in the UK


Related content

The future of HR 2019: In the Know or in the No - Oil and Gas

Artificial intelligence (AI) and machine learning (ML) are driving a digital transformation in Oil and Gas (O&G). Nearly all O&G HR executives agree that these technologies will bring considerable benefits, but only half have actively begun to implement them. This may be due to a level of insecurity about their role in leading AI initiatives: only 26 percent of O&G HR executives feel that they are leading the process, while 36 percent feel that they have limited or no involvement, or are unsure about their involvement. If the adoption of AI is to succeed, O&G HR executives will have to support change management. This will also encompass workforce transition. Robert Bolton, Global People and Change Centre of Excellence, KPMG in the UK, said that “although it may not be happening quite so quickly with O&G as in other industries, disruption is already underway. HR executives in O&G don’t have the luxury to sit back and wait to respond. They need to begin systematically planning what the workforce of the future needs to be, and shape their strategies to create that workforce.”

The implementation of AI will also require HR leaders to rethink how workplace roles and tasks are organized. Jobs might not be eliminated, but specific tasks within those jobs will certainly be affected. Some tasks might become automated, while others will require humans and machines to work together. In order to achieve improvements in productivity, HR will need to manage this reinvention of work and roles, while also ensuring that employees are given the tools and resources necessary to negotiate the transition successfully.

AI’s real benefits come from taking an enterprise approach, from being much more cross-functional. Because HR is one of the few functions that can respond to all the people implications that might result from an enterprise wide-deployment of AI, its leaders are poised to have a significant organizational impact. If they have a plan to direct the enterprise through the possible pitfalls caused by the future of work implications, HR executives can ensure that the enterprise considers the people agenda when scaling up the digital transformation. As this transformation continues, HR must chart a course that reduces ambiguity and creates new environments that allow workers to excel. With access to the reliable and predictive evidence that AI offers, O&G HR leaders will be able to guide the workforce through this change.

- Robert Bolton, Partner, Global People and Change Centre of Excellence, KPMG in the UK.

Read the report The future of HR industry 2019: In the Know or in the No (PDF 1.72 MB) to learn more about the effects of HR Transformation 

Analyst estimates: oil

2018 2019 2020 2021
Min 63.0
71.0 66.0 69.6
Average 73.0 76.2 73.7 70.5
Median 73.8 75.0 72.0 70.0
Max 75.5 83.0 80.0 73.0


$/bbl 2018 2019 2020 2021
October Avg 72.6 76.2 73.8 70.5
November Avg 73.0 76.2 73.7 70.5
October Median
74.0 75.0 72.0 70.0
November Median
73.8 75.0 72.0 70.0

Analysts estimate: gas

2018 2019 2020 2021
Min 2.8 2.6 2.6 2.6
Average 2.9 2.8 2.7 2.7
Median 2.9 2.8 2.7 2.7
Max 2.9 3.0 2.9 2.9


$/MMBtu 2018 2019 2020 2021
October Avg 2.9 2.8 2.7 2.7
November Avg
2.9 2.8 2.7 2.7
October Median
2.9 2.8 2.7 2.7
November Median
2.9 2.8 2.7 2.7

Note: The forecasts/analyst estimates above from Brent & Henry Hub are an indication based on third party sources and information. They do not represent the views of KPMG.

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