Oil Research

Oil research has increased in importance ever since the Arab countries cut off oil supplies to the USA and its allies in 1973-74. The petroleum exporting countries in the Arab world took this drastic step to punish the USA and its allies for helping Israel in its war against Egypt and Syria. Earlier, the western world took oil supplies from the Middle East for granted, but the Arab oil embargo showed, who had the upper hand.

Overnight, the oil market became a supplier market and a new word came into existence: “gas lines.” This word was coined to describe the phenomenon of US consumers queuing up outside gas pumps for gasoline supplies. The Arab oil embargo pushed up oil prices to new heights and triggered a global recession. Though the embargo ended in the following year, the relationship between the west and the Middle East changed forever.

Governmental Oil Research Sources

In 1977 the US Department of Energy was established in response to the Arab oil embargo. The original mandate of this department was to oversee energy resources and administer regulatory controls relating to price and allocation that came into existence as a result of the Arab oil embargo.

One of the major sources of oil research, The Energy Information Administration (EIA), was also established in 1977 as the statistical arm of the US Department of Energy. Its mandate was to “provide policy-independent data, forecasts, and analyses to promote sound policy making, efficient markets and public understanding regarding energy and its interaction with the economy and the environment.” Although the role of US Department of Energy has changed over the years, the EIA remains true to its original objective today.

The EIA is not the only quasi-government agency providing oil research, there are plenty of others. At the global level, the International Energy Agency (IEA) is the leading source of energy statistics. The International Energy Agency was also promoted in the aftermath of the Arab oil embargo in 1974 by select members of the Organisation for Economic Co-operation and Development.

The original objectives of the IEA were to respond to future oil emergencies and reduce dependence on oil. Now the IEA has become the forum for 26 industrialised countries for sharing information and ideas on the management of energy resources. The IEA continues to be a major source of energy statistics in the world.

The Organisation of Petroleum Exporting Countries (OPEC) besides discharging well-publicised functions, also engages in oil research. The OPEC publishes oil statistics on a periodic basis and carries out research studies.

Developing countries have also recognised the importance of oil research. In recent years, for instance, India has emerged as big importer of crude oil. Consequently, India has started investing heavily in oil research. The Petroleum Planning & Analysis Cell (PPAC) in the Ministry of Petroleum and Natural Gas of India besides discharging administrative functions, maintains a data bank on domestic as well as international oil and natural gas markets.

Private Sector Oil Research Sources

The Baker Institute Energy Forum at Rice University carries out research on energy-related challenges, including oil research. Most global oil and gas companies have strong oil research departments as well. In some instances, oil research of private companies is deeper than that of governments. The UK-based BP, for instance, publishes a highly-regarded annual ‘Statistical Review of World Energy’ that provides comprehensive data on all aspects of the energy business.

Oil research has also attracted private research firms in the past few years. Now firms such as Platts, a part of the Mcgraw-Hill Group and Cambridge Energy Research Associates have become credible sources of oil research.

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