Spend time in the boardrooms or around the water coolers of Houston, and the subject will soon turn to the day’s oil price. Due to a combination of anemic global economic growth and, among other things, the supply side revolution of North American Shale, the oil price has plummeted by almost 30% in the past 3 months. As I write this blog WTI* is trading at a 5 year low, leaving the industry contemplating the considerable challenge of operating at $70 per barrel.
While each company’s view on how to tackle this new paradigm will differ, for many it will be to continue the day job (deliver quality, innovative products and solutions), but at reduced time and cost, without compromising safety.
It’s my belief that first principles approach, based engineering simulation tools such as those we (CD-adapco) deliver, will be a key enabler, as companies will increasingly rely on simulation based design exploration. The initial driver will be to reduce engineering cost and time, but they’ll also benefit from simulation as an innovation enabler.