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Technology-led logistics solutions are poised to fuel the future of the oil and gas industry

Oil and gas businesses must modernise their supply chains to meet evolving industry needs

The oil and gas (O&G) industry remains at the very core of the dynamic energy landscape, with thermal power generation comprising around 77 per cent of the UAE’s energy mix . Currently, the sector is at a crossroads, facing a pressing need to modernise its operations and adapt to an increasingly dynamic and digitalised world. O&G supply chains now demand greater resilience and optimisation driven by technological innovations such as Artificial Intelligence (AI), data analytics, and blockchain. These challenges call for innovative logistics solutions and forward-thinking strategies.

In the energy industry, the timely shipment of raw materials and machinery is necessary to maintain operational flow and prevent downtime. To ensure greater resilience across the supply chain and meet industry demands for speed, reliability, and accuracy, O&G businesses must adopt logistics solutions capable of handling highly-specialised requirements across geographies, for multiple stakeholders.

For instance, O&G firms need flexible and agile shipping solutions to transport large and heavy machinery, or sensitive chemicals. This involves leveraging multi-modal networks that offer a balance of speed, efficiency, and accessibility. Moreover, to navigate supply chain disruptions or monitor critical shipments, O&G firms require reliable and efficient freight management and support. This can be achieved by real-time tracking and tracing, GPS-enabled trucks, and 24/7 network monitoring, all of which provide greater visibility into the transportation of goods.

Digital transformation

The advancement of technology, adoption of data-driven insights, and expansion of connectivity present a significant opportunity for O&G companies. Through digital transformation initiatives, businesses can gain a competitive edge and potentially save millions in operating costs while enhancing the intelligence and efficacy of their vast asset base.

The industrial Internet of Things (IoT), a part of the broad digital opportunity, is projected to add US$15 trillion of value to the global economy by 2030 . By integrating technologies such as AI, machine learning, and predictive analytics, O&G organisations can optimise their operations, reduce costs, predict disruptions, and adapt proactively, ensuring a stronger and more resilient supply chain.

Additionally, O&G companies can leverage smart logistics solutions for shipments that need more advanced tracking, whether it is for higher security, quality assurance, or enhanced visibility. Using sensor-based near real-time tracking solutions, shippers can receive proactive alerts about their package’s location, temperature, and other environmental factors, allowing them to intervene and control their shipment before reaching its final destination.

Companies in the sector can also benefit from adopting a phased and agile approach to digital transformation. Rather than implementing large-scale, time-intensive programs, firms should assess digital maturity across certain lines of business, pilot new technologies in alignment with organisational priorities, and scale up the initiatives that deliver the most value.

Innovative technologies are creating the landscape for what’s next. For wide-scale adoption, technologies should have clear real-world applications as well as be scalable in the long run. AI is a prime example of a disruptive future technology that is unfolding in the present, enabling transformation across the board – especially for the O&G industry. The logistics sector in particular is poised to drive this evolution.

The writer is vice-president of Fedex Middle East and Africa operations.