This year's International Petroleum (IP) Week was held just two months after the historic COP21 agreement reached in Paris last December. Climate change and oil prices were always going to be a key focus for the conference. The three day programme of events featured senior industry leaders discussing strategies for the oil and gas industry for navigating in the current environment.
The world is seeing a shift in supply and demand, in particular, we are seeing a new chapter for China - with the decoupling of energy demand and economic growth, improved efficiency and a shift in consumption away from coal. More than ever, IP Week 2016 has clearly shown an energy transition is underway, with anticipated growth in renewables and nuclear in previously oil and gas dominated regions such as the Middle East. The conversations over the course of the week show a consensus towards oil prices remaining low for a while longer. But it is these economic conditions that are reshaping supply.
Russia proclaim a fairly stable market which they attribute to a flexible taxation regime, lower production costs and diversifying into the oil services industry, growing fast in refining. Specifically, Rosneft are focusing on Asia markets and concentrating on promoting and developing long term contracts.
While policymakers are stepping up their commitment to reducing carbon, as the world expands, energy demand continues to grow. Sustainable energy production is therefore key. From BP's perspective, this can be achieved via the development of natural gas, reduced flaring and methane, improved efficiency and increased renewables. Energy efficiency can often be thought of specifically relating to the demand sector. However, it is a massive opportunity and there is so much more that can be done. It is more than just using less but also making processes in producing energy more efficient.
The mood over the three days was, overall, cautiously optimistic. There's no doubt that the falling oil prices paint a bleak picture for oil producers. However, combined with the stronger global commitment and political will for emissions reduction, the oil and gas sector is facing up to diversification to remain competitive.
None of these challenges are new and the industry isn't starting from scratch. The policies are needed to frame development and education is fundamental. In the longer term, these challenges should be viewed as opportunities to open new ways of thinking, creating innovative business models and demonstrating responsible leadership.
IP Week is organised every year by the Energy Institute (EI) and is its flagship oil and gas event. The official programme comprises a series of conferences and a prestigious industry dinner. Speakers include senior figures from the leading oil and gas producers, alongside government departments, trading houses and analysts. The events attract around 2,000 energy professionals to London from more than 50 countries around the world.