Home Tech News ICT: Oil & Gas industry to spend $5.33 billion in 2020, IDC says

ICT: Oil & Gas industry to spend $5.33 billion in 2020, IDC says

ICT: Oil & Gas industry to spend $5.33 billion in 2020, IDC says
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The information and communications technology (ICT) spending of the Middle East and Africa’s oil and gas industry will peak at $5.33 billion, up from $5.17 billion last year, according to the International Data Corporation (IDC).

Businesses from the Middle East and Africa’s resource industries comprising oil & gas mining, other mining, and agriculture are looking towards ICT as they face unprecedented challenges, the technology research company, IDC forecasts.

IDC forecasts the industry’s ICT spending to reach $5.33 billion this year and continue rising at a compound annual growth rate of 4.1% over the coming years to reach $5.79 billion in 2023.

“Many industry experts believe that the era of ‘easy oil’ is over and that companies will have to explore new frontiers which pose more operational challenges.”

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“The oil industry is facing unprecedented challenges,” says Gaurav Verma, oil and energy research manager at IDC Energy Insights. “Many industry experts believe that the era of ‘easy oil’ is over and that companies will have to explore new frontiers which pose more operational challenges.”

Verma adds that, “the complexities of extracting hydrocarbons in harsh and remote environments such as ultra-deep-water oil fields, coupled with uncontrollable external pressures and oil market volatility, are driving oil and gas companies to adopt digital transformation (DX) initiatives as they strive to enhance their levels of efficiency, agility, and resilience.”

According to IDC, this pursuit of DX is driving a shift in investment focus for oil and gas companies, with many now turning to cloud to enable the enhanced efficiency and data-driven decision making that their new strategic priorities require. 

Consequently, IDC expects that by 2021 about 75% of oil and gas companies worldwide will have moved the majority of their on-premises applications to the cloud to facilitate scalability and digital innovation across the organisation.

The industry’s multifaceted transformation is also driving increased interest in artificial intelligence and machine learning as organizations look to augment employee productivity, boost business agility, and address the implications of an ever-growing skills gap. 

As such, IDC expects that by 2022, 90% of oil majors worldwide will have deployed AI-powered applications to various exploration processes ranging from automated drilling to cognitive seismic data analysis to reservoir modeling.

According to IDC, all these issues and more will be discussed during a dedicated oil and gas session titled ‘Unlocking the Power of Data – The Keystone of Digital Transformation in O&G’ that will take place at the upcoming IDC Middle East CIO Summit 2020. The annual event has served as a beacon of ICT thought leadership across the region since 2008, and this year’s edition will be hosted at Dubai’s Atlantis, The Palm on February 26-27.

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