WITH the scarcity of employment in the oil and gas industry, graduates with both soft skills and knowledge will have an edge in the competitive job market.
Tertiary students in this field are taking their own initiative to ready themselves for job recruitment upon graduation.
Felicity Valerie Karim, a 23-year-old final-year petroleum engineering student at Curtin University, said: “Fresh graduates are having difficulties in getting jobs. Be proactive and get involved in programmes in order to network and put yourself in the market,” she said.
Universiti Teknologi Malaysia final-year petroleum engineering student Boshkiran Segar, 22, has always strived to gain extra skills in addition to academic knowledge.
“Students learn theories at university. In terms of practical experience, we can only earn it outside the university, through programmes and internships. Exposure and on-the-job learning enhance theories,” he said.
Concerned about employability, Felicity and Boshkiran have joined the NrgEdge Ambassador Programme crafted for students and fresh graduates interested in the energy, oil and gas industry.
The initiative encourages participants to get a head start in the sector and their career journey by getting involved in industry events and learning networking skills.
As ambassadors, students will be the bridge connecting their university and peers with the industry and its latest developments to ensure that the future generations of energy professionals are well-equipped for the transition to professional life.
The programme has received more 150 applicants from various countries to date. However, at present, only Malaysian and Bruneian applicants are accepted.
NrgEdge co-founder Malina Raman said: “This programme was put together to spread the knowledge about what the industry has to offer. Participants network at our professional events and boost their confidence by learning to speak in public. NrgEdge ambassadors also get access to career mentors for guidance on the job market, resume writing as well as skills at an interview.”
Malina added that those employed in the fast growing renewable energy sector will have to update their skills constantly.
“In the long term, the fossil fuels industry will go into a transitionary phase. Undergraduates and young professionals must understand their new prospects in the jobs market of the future. Job opportunities will be different from a decade ago, as there will be more emphasis on the downstream and petrochemicals sector, and the development and production of cleaner fossil fuels such as natural gas.
“As the economies in Malaysia and across the world continue to grow, there will be a sustained need for more energy. The skills acquired by students and young professionals today through varied engineering and scientific disciplines can be applied in the fast growing renewable energy sector.”
At the NrgEdge Ambassador Boot Camp, the first training session of the programme, trainer Siti Rasidah Mohd Shihab coached 16 students in mind-challenging activities.
Siti Rasidah, who had worked with Petronas for 25 years, sees this programme as training participants to survive in a world with fewer job openings.
“Graduates are flooding the market. They have to work at getting employment these days. Given the tough job market, they have to buck up. Things are not how they used to be.
“Previously, graduates were easily employed as soon as they graduated. This is not the case today. They have to compete and be versatile.”
The first instalment of the programme will see 31 participants taking part in a series of events to be conducted across Malaysia.
One of the ambassadors, final-year petroleum engineering student Fatin Aina Zawani Jais, 21, said that this programme gives her the chance to network with people face-to-face, a practice which is getting rare in the digitalised world.
“It is important to meet people to share opportunities and knowledge to gain exposure to the industry. We talk about issues which we don’t get to express at university. We learn about the differences in the learning environment at different tertiary institutions and the syllabi,” she said.
NrgEdge regional strategic partnerships manager Mohd Anas Asalem, who is also a graduate of the oil and gas field, said that the programme creates multi-talented employees to fill the talent gap in the sector.
“When people in the industry retire, fresh graduates cannot fill the posts because of the downturn. This has been taking place for 20 years,” he added.
NrgEdge is trying to expand its programme to Brunei, Indonesia and Thailand. This year the programme received applicants from Malaysia (40 per cent), Indonesia (18), Singapore (12), India (nine) and other countries (21).
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Headline crude prices for the week beginning 7 October 2019 – Brent: US$58/b; WTI: US$52/b
Headlines of the week
In the October 2019 Short-Term Energy Outlook (STEO), the U.S. Energy Information Administration (EIA) forecasts lower crude oil prices in the fourth quarter of 2019 and in 2020 despite tighter global balances. The tighter balances are largely the result of unprecedented short-lived loss of global supply following the September 14 attacks on crude oil production and processing infrastructure in Saudi Arabia. The production declines contribute to overall stock draws in the second half of 2019 with a relatively large stock draw in the third quarter. In the fourth quarter, however, EIA forecasts global supply growth will outpace global demand growth, resulting in an inventory build, offsetting some of the third quarter draws (Figure 1). EIA lowered its crude oil price forecast for the fourth quarter of 2019 by $1 per barrel (b) to $59/b, reflecting current price trends, and lowered its crude oil price forecast for 2020 by $2/b to average $60/b because of expected supply growth.
In the October STEO, EIA forecasts total global petroleum stocks in the second half of 2019 will decrease by an average of 290,000 barrels per day (b/d), compared with the September STEO forecast stock build of 250,000 b/d for the same period. EIA forecasts total world crude oil and other liquids production for the second half of 2019 to average 101.3 million b/d, down by 550,000 b/d from the September STEO. Most of the production decline is the result of lower output from Saudi Arabia, reducing the collective output of the Organization of the Petroleum Exporting Countries (OPEC) to 34.8 million b/d for the second half of 2019.
In the October STEO, EIA assumed the Abqaiq facility and Khurais oil field would produce at their pre-attack levels by the end of October. Compared with the September STEO, EIA revised OPEC spare capacity, most of which is located in Saudi Arabia, lower by an average of 200,000 b/d in the second half of 2019. Saudi Arabia's total capacity (including spare capacity) declined following the Abqaiq attack, and EIA expects Saudi Arabia will use some of its remaining spare capacity to backfill inventories and lost production through the end of 2019. Beginning in January 2020, EIA forecasts that OPEC spare capacity will return above 2.0 million b/d.
Crude oil prices increased sharply following the attacks; Brent front-month futures prices rose by nearly 15% on Monday, September 16, the first day of post-attack trading. This increase was the largest one-day percentage increase on record for Brent front-month futures prices. The increase was larger in the front months of the futures strip than in the later months, indicating the market expected the outage to be relatively short lived, and prices fell quickly after the attack (Figure 2). Saudi Arabia continued to export crude oil by drawing from inventories, increasing production in other fields, and reducing domestic refinery inputs. Abqaiq's relatively quick return to operations likely lessened the extent and duration of the price increases. Brent front-month futures prices fell to lower than pre-attack levels on October 1, settling at $59/b for the December contract and have fallen slightly since then.
The relatively quick return to pre-attack price levels likely reflects demand-side concerns and increased down-side price risk. Despite tighter forecast global petroleum markets in the second half of 2019, EIA expects that the Brent crude oil price will average $60.63/b in the second half of 2019, nearly unchanged from the $60.68/b forecast in the September STEO. EIA forecasts that global petroleum inventories will increase by nearly 550,000 b/d in the first half of 2020, which is expected to put downward pressure on crude oil prices. EIA forecasts the price of Brent crude oil to average $57.34/b during the first half of 2020. However, EIA expects the price of Brent crude oil to increase to $62.48/b in the second half of 2020 as global petroleum stock builds slow and petroleum balances are relatively tighter than during the first half of the year.
The price forecast is highly uncertain and supply or demand factors may emerge that could move prices higher or lower than EIA's current STEO forecast. Driven by revisions to global economic outlook, EIA has revised its 2019 liquid fuels demand growth outlook lower in the STEO for the last nine consecutive months and 2020 consumption has been revised down eight of the last nine months. EIA's price forecast also accounts for a higher level of petroleum supply risk in the aftermath of the attacks in Saudi Arabia.
U.S. average regular gasoline prices increase slightly, diesel prices fall
The U.S. average regular gasoline retail price rose less than 1 cent from the previous week to $2.65 per gallon on October 7, 26 cents lower than the same time last year. The West Coast price rose by nearly 10 cents to $3.64 per gallon, and gasoline prices in California continued to rise, increasing by 14 cents to $4.09 per gallon, 55% higher than the national average and 39 cents higher than the same time last year. The Midwest price increased by more than 1 cent to $2.50 per gallon, and the Rocky Mountain price increased by less than 1 cent, remaining at $2.71 per gallon. The Gulf Coast price fell by more than 4 cents to $2.28 per gallon, and the East Coast price fell by 2 cents to $2.49 per gallon.
The U.S. average diesel fuel price fell nearly 2 cents to $3.05 per gallon on October 7, 34 cents lower than a year ago. The East Coast and Gulf Coast prices each fell by more than 2 cents to $3.04 per gallon and $2.80 per gallon, respectively, the Midwest price fell by 2 cents $2.97 per gallon, the Rocky Mountain price decreased 1 cent to $3.02 per gallon, and the West Coast price decreased by less than 1 cent to $3.64 per gallon.
Propane/propylene inventories increase
U.S. propane/propylene stocks increased by 0.1 million barrels last week to 100.8 million barrels as of October 4, 2019, 11.9 million barrels (13.4%) greater than the five-year (2014-18) average inventory levels for this same time of year. Gulf Coast inventories increased by 1.0 million barrels, and Midwest inventories rose slightly, remaining virtually unchanged. East Coast inventories decreased by 0.9 million barrels, and Rocky Mountain/West Coast fell slightly, remaining virtually unchanged. Propylene non-fuel-use inventories represented 4.4% of total propane/propylene inventories.
Residential Heating Fuel Price Survey Begins This Week
Beginning this week and continuing through the end of March 2020, prices for wholesale and residential heating oil and propane will be included in This Week in Petroleum and on EIA's Heating Oil and Propane Update webpage.
As of October 7, 2019, residential heating oil prices averaged nearly $2.95 per gallon, 41 cents per gallon lower than at the same time last year. The average wholesale heating oil price for the start of the 2019–20 heating season is $1.99 per gallon, over 48 cents per gallon below the October 8, 2018, price.
Residential propane prices entered the 2019–20 heating season averaging nearly $1.86 per gallon, 53 cents per gallon less than the October 8, 2018, price. Wholesale propane prices averaged more than $0.58 per gallon, 43 cents per gallon lower than the same time last year.
Monthly U.S. crude oil production fell by 276,000 barrels per day (b/d) in July 2019, based on the latest data in the U.S. Energy Information Administration’s (EIA) Petroleum Supply Monthly. This hurricane-related decrease was the largest decline in monthly crude oil production in more than a decade. The decline was temporary and geographically isolated to the Federal Offshore Gulf of Mexico. EIA expects that U.S. crude oil production will continue to increase through the remainder of 2019.
Crude oil production in the Federal Offshore Gulf of Mexico fell by 332,000 b/d in July when some production platforms were evacuated in anticipation of Hurricane Barry. According to information from the U.S. Department of the Interior’s Bureau of Safety and Environmental Enforcement (BSEE), 283 offshore oil and gas platforms in the Gulf of Mexico (about 42% of the regional total) were evacuated in mid-July as Barry approached.
BSEE estimated that about 70% of Gulf of Mexico crude oil production was shut in (i.e., not operating) at the peak of the disruption as a result of the evacuation. Excluding the Federal Offshore Gulf of Mexico, U.S. crude oil production in the rest of the United States rose by a combined 56,000 b/d in July, partially mitigating the disruption.
Historically, many of the largest monthly declines in U.S. crude oil production were the result of hurricanes. Hurricanes Gustav and Ike led to crude oil production falling by more than 1 million barrels per day in September 2008. Hurricanes Katrina and Rita led to a similar month-on-month decline in September 2005.
By comparison, Hurricane Barry’s disruption occurred relatively early in the hurricane season and had less of an effect on total U.S. crude oil production. As onshore U.S. crude oil production has grown, the Gulf of Mexico’s share of the national total has fallen from a high of 29% in 2009 to 16% in 2018.
In developing crude oil production forecasts for each month’s Short-Term Energy Outlook, EIA uses the latest data from the Petroleum Supply Monthly and Weekly Petroleum Status Report, among other sources. As a result, EIA had already accounted for estimates of Hurricane Barry’s effect on crude oil production in the Gulf of Mexico in the August edition of the STEO.
In the October STEO, released earlier this week, EIA expects that U.S. crude oil production will increase in each remaining month of 2019, and ultimately reach 13.0 million b/d in December 2019. EIA expects U.S. crude oil production to average 12.3 million b/d in 2019 and 13.2 million b/d in 2020.