Cost Insights
by PowerAdvocate

Intelligence for energy companies seeking a data-driven approach to cost management

Europe O&G: 2021 Upstream Market Forecasts

March 9, 2021 at 10:13 AM / by PowerAdvocate posted in Industry Insights, Oil & Gas

2021 marks an opportunity for upstream operators to overcome cost challenges presented amid last year's turbulent market through appropriate CapEx and OpEx forecasting. 

In our latest market report, we provide cost forecasts for key CapEx & OpEx categories and outline why we see cost increases across almost all of them which are forecast to rise between ~1%-12% between February 2021 and January 2022. 

Some of the top categories with notable inflationary/deflationary trends included in the report are: 

  • CapEx: OCTG, onshore & offshore drilling rigs, and wellhead equipment services
  • OpEx: Production chemicals, compression services, and offshore support vessels

As operators focus on optimizing their costs in 2021, it is key to leverage market forecasts to estimate key cost changes and forecast spend. 

Market Forecast Overall Weighted Trend Based on Brent Crude Spot Price Scenarios


Europe O&G: 2021 Downstream Market Reflections

February 8, 2021 at 3:24 PM / by PowerAdvocate posted in Industry Insights, Oil & Gas

2020 has been a volatile year for downstream supply markets, and several key cost categories have moved sharply. For example, since last January,

  • Hot-Rolled Coil Steel costs have increased by 40%+
  • Copper costs have increased by 16%+
  • Organic Basic Chemicals costs have decreased by 4%+

As operators refine their CapEx and OpEx programs for 2021, we have found that it is important to understand both how key downstream commodities have trended, and the impacts of those trends on key cost categories – for example, the 16%+ increase in copper costs contributed to a 7%+ increase in Electrical Supplies.


Europe O&G: 2020 Upstream Cost Top Movers

December 17, 2020 at 10:34 AM / by PowerAdvocate posted in Industry Insights, Oil & Gas

2020 has been a volatile year for upstream supply markets in Europe, and several key cost categories have experienced inflationary pressure. For example, since January,

  • Screen costs have increased by 16.6%
  • Generator costs have increased by 11.7%
  • Carbon Steel Pipe costs have increased by 11.3%

Understanding how key cost markets are trending unlocks value across the entire cost management lifecycle:  from identifying market-driven opportunities and risks to support category strategy development, to executing data-driven vendor negotiations, to tying contracts to favorable indices to underpin contract resilience.

Our team recently put together a list of upstream cost categories which experienced the most inflationary pressure during 2020. 



Accelerating Supplier Diversity Programs

October 20, 2020 at 4:23 PM / by PowerAdvocate posted in Power & Utilities

This year's economic, cultural, and health environment has elevated the industry's focus on supplier diversity initiatives. As an example, over 50% of the top 25 investor-owned utilities in the US referenced the topic in their Q2 earnings call, vs. just 20% in Q2 of last year. However, data and resource challenges can often hinder progress to stated diversity program goals.


A Narrowing Opportunity for Mining Supply Chains

July 14, 2020 at 8:37 PM / by PowerAdvocate posted in Cost Reduction, Industry Insights, Mining

As commodity markets rebound, the window of opportunity for mining operators to drive supply chain savings is narrowing.

In this discussion, we look at:

  • Recent trends in commodity metals pricing
  • How these trends represent a strategic – and narrowing – opportunity for mining operators to capture savings
  • Key components of a strategic roadmap for how mining supply chains can effectively leverage current market conditions to achieve market-based savings and protect against future inflation risk

What COVID-19 Means for Your Supply of Mining Tires

June 1, 2020 at 4:21 PM / by PowerAdvocate posted in Cost Reduction, Industry Insights, Mining

In this discussion we look at the building blocks needed to understand supply chain risk across the enterprise and dig deep into the cost structure of mining tires to answer the following questions:

  • What are the drivers behind the rise and fall of mining tire prices in different regions?
  • What are the bottlenecks with your supply of mining tires?
  • What does the future look like for key mining tire suppliers?

Pricing Projects in the Wake of an Oil Crash: How Midstream Firms Can Stay Competitive in a Down Market

April 10, 2020 at 6:00 PM / by PowerAdvocate posted in Project Estimation, Cost Reduction, Industry Insights, Oil & Gas

COVID19 Production


Amidst the COVID-19 market downturn, midstream projects are under intense scrutiny as executives look to reduce spending in a capital-constrained environment. However, data challenges prevent firms from identifying opportunities to lower cost estimates, resulting in scrapped projects and lost bids.


COVID-19 Market Report: Managing O&G Supply Chain in the Face of a Market Crisis

April 8, 2020 at 4:20 PM / by PowerAdvocate posted in Cost Reduction, Industry Insights, Oil & Gas

COVID-19 Should-Cost


As the market downturn has forced Oil and Gas operators to diligently scrutinize 2020 budgets, common data challenges are impeding E&P executives from taking swift action. 

In our most recent market report, we examine two questions raised by executives grappling with the current market crisis:


Soft Oilfield Service Prices: Implications for Supply Chains

December 24, 2019 at 5:42 PM / by Elcin Aktasosburg and Jordan Monahan posted in Industry Insights, Oil & Gas, Power & Utilities



Highlights from the 2019 Houston Wood Mackenzie Energy Summit

December 19, 2019 at 3:46 PM / by PowerAdvocate posted in Industry Insights, Oil & Gas

We’re excited to share that PowerAdvocate recently took part in sister company Wood Mackenzie’s Energy Summit in Houston.

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