Situation Analysis

The national government of a country heavily dependent on crude export revenue found it needed better visibility into oil prices and global oil market fundamental in order to better predict crude export revenue. Officials wanted a customized, web-based dashboard that would provide the necessary overview and real-time indicators for the global crude oil market. It was also important that this system could be maintained internally to support the country’s crude oil policy decision making.

Discovery & Solutions

Strategic Decisions Group took a systematic approach, initially developing a set of crude oil market indicators and their data sources. Market indicators included crude supply (global as well as for major producers), demand growth, inventory for OECD countries and major producers, major benchmark spot and futures prices, and E&P capital spending trends. SDG then developed a customized set of analyses that would provide a comprehensive overview of global oil market. The system was initially on an offline platform that required manual data update.

Proceeding from the offline platform, SDG put the system into a web environment, implementing a self-updating mechanism to refresh the system daily with publicly available data accessible over the internet, eliminating the manual update. SDG added a text-based section to each analysis so that the system editor could incorporate the context behind the analysis and commentaries.

SDG enhanced the system by building interactive analyses and adding SDG-created content to the system. Interactive analyses included the country’s crude oil balancing model, which would allow the user to see the impact on the country’s crude export revenue as a function of crude production, target export volume, and inventory policy. SDG-created content included its short-term crude price outlook based on crude market fundamentals. The system is also equipped with the capability to generate a PowerPoint-based crude oil market outlook.

Results & Impact

A select group of government users is subscribed to the system. Insights into the global and domestic oil markets generated from the dashboard are regularly shared broadly within the government, providing the foundation for reviewing the country’s current oil policy.