The oil industry is currently reeling from the coronavirus pandemic. Alongside the direct impact of Covid-19 spreading across the world and causing illness, there are multiple indirect effects as well. The use of lockdowns, quarantines and shelter in place orders across countries has generated far less consumption of oil and derivative products; this has led to oil producers storing far more product than was previously anticipated; and the glut of oil has driven price conflicts between major oil-producing countries, driving down the price further still.
The demand destruction that has taken place is unprecedented. According to Trafigura’s chief economist, demand could drop by more than 30 million bbl, equivalent to around a third in daily oil consumption across the world. In turn, this will have a huge destabilising impact on economies and security.
For oil companies managing their response to this market situation, the initial and short-term market impact will be concerning. However, the economic impact on companies and countries will also have its own problems as well. The risk to security is huge.
Managing risk with threat intelligence
To track the potential risk here, threat intelligence data will be essential. This involves bringing together information on events that are taking place that represent either direct or indirect threats to the organisation and providing that information together with the right degree of context and certainty. This data can help companies plan ahead around their security and operations so that risks can be monitored, mitigated or prevented.
For oil companies, the challenge around threat intelligence is not that this data is unavailable. In fact, the very opposite is true: there is a wealth of data available that can be used. The problem is synthesising this information to be useful for the business as a whole.
The standard approach for oil companies around physical security is that they will have teams in each location or region where oilfields are sited. These teams are responsible for keeping locations secure and protected against all potential risks, from petty crime through to terrorism or serious attack. Each security team involved will have their own information sources and applications in place that will provide them with insight into potential threats or attacks for planning purposes, as well as real time data from a mix of commercial, police, military and government sources.
The issue here is two-fold: firstly, the team in each region will have to manage the inflow of data that they have in order to make it useful to them. Secondly, the wider business has little control or oversight of that data.
For those responsible for the wider business, picking up on trends and threats in real time is made more difficult due to the surfeit of data that is held in different silos. Each team can run their own data feeds and tools, so it becomes very difficult to manage correctly or get that accurate overview of potential threats, systemic risks or future activities across the whole business. With most oil producing companies involved in multiple locations and global distributions of fields, this viewpoint is necessary for future business planning.
Seeing both the big picture and all the details
To overcome this issue, it is necessary to consolidate multiple sources of data and applications into one, and then make this source of data available to teams instead. For those on the ground in a particular country, threat intelligence data can meet their particular needs around risks in the local area. For those responsible for global activity or for wider planning around security and business continuity, it is essential to get the bigger picture around the direct impact of threats such as coronavirus alongside indirect risks like civil unrest, terrorism or supply chain disturbances.
This involves balancing the needs and the understanding of local teams against the requirements of the larger business. However, by taking data and processing it centrally before applying the right approach around filtering and availability, both ends of the organisation can have their needs met.
The work involved to design this is substantial, particularly when it involves taking data from multiple services. However, providing that complete and comprehensive picture of the threat intelligence landscape should allow oil companies to identify threats more quickly and orchestrate responses more efficiently. This can also help to share information across different teams in the same geography or region to improve forward planning and risk management. Lastly, this approach can reduce the spending on duplicate sets of data and therefore cut the cost to run physical security planning over time.
As the organisations involved in planning global oil production around the world meet to decide how to move forward around Covid-19 and the impact on demand, the prices for oil may stabilise. However, the risk to economies in countries around the globe that depend on the sale of oil will continue for some time. Planning ahead around these risks will involve better use of data across companies, so that future shocks can be anticipated and then either avoided or mitigated.
Read the article online at: https://www.oilfieldtechnology.com/special-reports/24042020/managing-uncertainty-threat-intelligence-and-the-impact-of-coronavirus-on-the-oil-sector/