Strategic crisis management during COVID-19: some recommendations for oil and gas enterprises

  • Nguyen Hong Minh
Keywords: COVID-19, strategic crisis management, corporate governance, oil and gas

Abstract

Oil and gas companies around the world are suffering double impacts during the COVID-19 pandemic. Firstly, social distancing and lockdown measures imposed in many countries have led to difficulties in movement, frozen supply of high-quality human resources, closure or reduced scale of certain number of production facilities, interruption of important services, and unpredictable prices, affecting the continuity of production and business activities. Secondly, as oil demand goes down due to plummeting travel demand and lessened economic activities, oil prices have seen an unprecedented low in the history, resulting in serious consequences, e.g. shrunken revenue, excessive inventories, and instability or shortage of cash flow, causing difficulties for businesses in various sectors such as E&P, oil and gas production and processing, oil and gas technical services.
In this paper, the author introduces the strategic crisis management approach proposed by Martin Hirt (McKinsey), with some recommendations for oil and gas companies from BCG and IHS consultants and the author himself in the context of this unprecedented crisis.

References

[1]. Martin Hirt, Sven Smit, Chris Bradley, Robert Uhlaner, Mihir Mysore, Yuval Atsmon and Nicholas Northcot, "Getting ahead of the next stage of the coronavirus crisis", McKinsey & Company, 4/2020.
[2]. Deloitte, “COVID-19 checklist: Practical steps for immediate, midterm, and long-term”, 4/2020.
[3]. BCG, “Navigating through COVID-19 and oil supply-demand shock”, Presentation to PVN and VPI, 4/2020.
[4]. Accenture, “Continuity in crisis: How to run effective business services during COVID-19”, 4/2020.
[5]. IHS, “Webinar: Navigating short-term risks and planning for long-term value creation in E&P”, 4/2020.
[6]. Kevin Sneader and Shubham Singhal, “The future is not what it used to be: Thoughts on the shape of the next normal”, McKinsey & Company, 4/2020.
[7]. Hugh Courtney, Jane Kirkland and Patrick Viguerie, “Strategy under uncertainty”, Harvard Business Review, pp. 11 - 12, 1997.
[8]. Rystad Energy, “Covid-19 report, 6th edition: Global outbreak overview and its impact on the energy sector”, 4/2020.
[9]. Wood Mackenzie, “Exposing and managing risks in oil and gas supply chain”, 4/2020.
Published
2020-04-30
How to Cite
Nguyen Hong Minh. (2020). Strategic crisis management during COVID-19: some recommendations for oil and gas enterprises. Petrovietnam Journal, 4, 50 - 55. https://doi.org/10.25073/petrovietnam journal.v4i0.305
Section
Articles