ArrowHead Solutions – Oil and Refined Products

ArrowHead Solutions Help Clients Understand Future Oil Markets to Aid Their Decisions

ArrowHead Oil and Refined Products Solutions Help Clients Understand How Potential Market Events Impact Their Businesses

ArrowHead oil and refined products solutions include helping clients to understand specific oil industry issues and how these issues impact our client’s business based on assumptions about the market drivers.

Many of these issues are around commodity price, such as:

  • What will world oil and refined product prices be over the next 40 years? What does that mean for our upstream or midstream budgeting and expenditures?
  • What if tight and unconventional oil flourishes in the coming decade (e.g., Eagle Ford, Bakken, Venezuelan heavy)? What will that do to prices? What tight and unconventional oil contribute a lower quantity, restricted to sweet spots and current prospects?
  • What if Saudi Arabia and Russia cut output to 7 mmbd each?
  • What if GTL from burgeoning shale deposits injects larger quantities of distillate into end use markets in industrialized countries and squeezes refinery output? What if GTL occurs only marginally?
  • What if refined product demand continues to grow? What if that growth slows as transportation and other end uses evolve toward other fuel forms?
  • What if there is chronic surplus of refining capacity? What if excess capacity tightens?
  • What if transportation infrastructure like Keystone XL were built quickly? What if its construction is thwarted? What resulting differentials across crude types might be realistic? Where will Canadian oil sands go? Syncrude exports to Asia? Refinery stimulation in Western Canada with export of product to the United States?

Oil and refined product companies seek help with specific types of issues or decisions, such as:

How ArrowHead Oil and Refined Products Solutions Help:

ArrowHead consultants use the Arrowhead Global Oil Model and other related ArrowHead Models to calculate probability distributions over prices and quantities across the decision time frame our clients need. Clients can have us use our assumptions and probabilities, or their own. It is easy to adjust models to reflect any of the conditions or events reflected in the types of issues presented above. Then, using probabilities for each of the market assumptions or issues that must be explored, the models calculate the probability distributions over prices and quantities (for oil and refined products, thus also providing the bases for these commodities) needed to answer the questions and issues. Not only does the model provide an accurate representation of market behavior under the various assumptions, but it also accurately applies the calculations for the various probabilities in an integrated fashion in a single run. Our oil market specialists can also help clients analyze the model results and apply the model results to helping make a specific decision or to understand how certain events would impact the oil and refined products markets and as a result their businesses.