Geopolitical Unrest in the Middle East: Assessing the Risk to Global Oil Supply and Implications for Energy Markets in 2024

An investment of US$15 billion has been made by ExxonMobil Corporation to establish a petrochemical refinery and carbon capture and storage (CCS) in Indonesia. This massive commitment of over Rp239 trillion aims to promote sustainable energy in the country by using an advanced technology to capture carbon dioxide (CO2) from industrial sources and store it underground. Carole Gall, President Director of ExxonMobil Indonesia, has underlined the corporation’s commitment in supporting environmental sustainability, including in achieving Indonesia's net-zero emission goals.Indonesia’s Minister of Investment and Downstream Industry, Rosan Roeslani, stated that ExxonMobil’s initiative was inspired by British Petroleum’s (BP) recent US$7 billion investment in the Tangguh Ubadari, Carbon Capture Utilization & Storage (CCUS), and Compression—or Tangguh UCC—project in Bintuni Bay, West Papua. This project is scheduled to start in 2028 and will include the development of the Ubadari gas field, the installation of CCUS and exhaust gas recirculation (EGR) at the Vorwata Field, and the improvement of the Tangguh LNG facilities with onshore compressors.While ExxonMobil's investment is twice that of BP's, both efforts share a common goal to cut greenhouse gas emissions and help Indonesia in transitioning to a more sustainable future. By implementing CCUS and EGR technologies, this project represents an important step toward increasing the country’s capacity for clean energy production. As more details of ExxonMobil's plans come to light, all eyes will turn to see how this investment would affect Indonesia's energy future.As the spotlight turns toward the execution of ExxonMobil's plans, this unprecedented investment holds the promise of reshaping Indonesia’s energy landscape. By fostering innovation, reducing environmental impact, and enhancing energy production capacity, ExxonMobil's CCS project could serve as a cornerstone for Indonesia's sustainable energy future. The successful implementation of this initiative will not only reinforce Indonesia's position as a key player in the global energy transition but also inspire other nations to follow suit in prioritizing sustainability and environmental stewardship

This year's Welcome Party Member event is taking an exciting step by integrating with the Oil & Gas 101 session from the Science Course Division. Taking place in the Auditorium Pascasarjana at ITS on Thursday, October 5th, this combined event is split into two key segments: department introductions and Oil & Gas 101.The event kicks off with a warm welcome from the master of ceremonies, followed by an opening speech to set the stage. Subsequently, the spotlight shifts to the introduction of each department in SPE ITS SC by directors and heads of divisions. This provides members with a snapshot of the different aspects and work programs that SPE covers.Following these department presentations, an interactive question-and-answer session follows. Here, members had the chance to engage with the Board of Directors and the Heads of Divisions to seek clarification and dive deeper into SPE ITS SC’s work programs. This open dialogue gave members a platform to address specific queries and concerns they might have had about the organization's activities. Many took advantage of this forum to delve into the finer details of SPE ITS SC's work programs, seeking a better understanding of how they could actively participate and contribute.Once the first session wrapped up, the second segment started—Science Course Division's Oil & Gas 101. In this segment, the speaker provides a comprehensive overview of the oil and gas industry fundamentals. Abdul Quddus Al Kahfi as the speaker thoughtfully breaks down the intricacies of the industry, highlighting its three crucial operation stages: Upstream, Midstream, and Downstream. Additionally, the audience gains insights into the latest developments and innovations shaping the sector's landscape. The primary goal here is to provide SPE ITS SC members with a robust and foundational understanding of this field.As with the department introductions, the Oil & Gas 101 session is followed by an engaging question-and-answer segment. Several members posed intriguing questions, reflecting their eagerness to delve deeper into the materials presented and their genuine interest in the future prospects of the oil and gas industry.To cap things off, participants had the opportunity to put their newfound knowledge to the test with the Petroquiz, managed by the Research and Information Division. This exciting quiz is a chance to apply what they've learned and add a touch of friendly competition to the event. All in all, this integrated Welcome Party Member presented an insightful and engaging experience for all participants.“The welcome party for new members by SPE ITS SC was very fun and valuable. Because from this event, I gained a lot of new knowledge and met other members who have the same interest in the petroleum industry.” Giody, a first-year student in Marine Engineering who won the Petroquiz, explained that he decided to attend the welcome party because he has a strong desire to learn more about the oil & gas sector in Indonesia. He felt that attending the event strengthened his decision to join SPE ITS SC as a member and he hoped that this would be a place for him to grow and learn more about the oil and gas industry. Written By: Arya Nugraha Aulia Rahman Yusup

Oil prices have long been a key driver of economic trends around the world. As the primary source of energy for many industries and households, fluctuations in oil prices can have far-reaching effects on both advanced and developing economies. From transportation costs to inflation and industrial production, oil prices impact nearly every sector of the global economy. Given oil's status as a high-demand global commodity, significant price fluctuations can have profound economic consequences. Oil prices are determined by a mix of supply and demand, production costs, and market sentiment. Supply and demand are influenced by the oil futures market, where contracts are made to buy or sell oil at a specific price on a future date. The cost of extraction also affects prices—easily accessible oil is cheaper to produce, while complex methods like deep-sea drilling require costly technology, pushing prices higher. Lastly, market sentiment plays a role, as speculation about future demand can drive up prices when traders buy oil futures contracts in anticipation of future shortages or increased demand.In 2020, the demand for oil plugged during the pandemic, with lockdown causing the price to fall below zero for the first time in history to a sharp downturn in economic activity. Since then, oil prices have surged to nearly $100 per barrel, driven by strong economic recovery post-lockdown. As the economy grows, so does the demand for oil. Oil accounts for approximately 3% of global GDP and is one of the most important commodities worldwide.Source : world economic forumAn increase in oil prices affects not only gasoline cost but also virtually all goods and services. Oil serves as both a feedstock and source of energy and is integral to transportation across industries. When oil prices rise, energy is integral to transportation across industries. When oil prices ries, energy bills increase, and these costs are passed on to consumers through higher prices for goods and services. This often leads to inflation, as the cost of living rises and the purchasing power of consumers declines. For many countries, oil and gas revenues are central to their economic stability. Nations that are major exporters, such as Saudi Arabia and Russia, rely heavily on income from these resources to fund government spending, infrastructure projects, and social programs. When oil prices plummet, these countries face budget deficits, currency devaluations, and economic downturns. On the other hand, oil-importing nations, particularly in the developing world, struggle with rising import costs when prices increase, worsening trade deficits and slowing economic growth. The global dependence on oil and gas keeps national economies vulnerable to market shiftsThe oil and gas industry plays a critical role in global supply chains, especially in sectors like transportation, manufacturing, and agriculture. Rising oil and gas prices can disrupt supply chains by increasing the cost of raw materials, transportation, and energy-intensive production processes. For instance, the shipping industry, which relies on oil-based fuels, faces higher operational costs, which are then passed on to consumers. These disruptions can cause delays in the availability of goods, increase the prices of everyday items, and slow down global trade, impacting economies worldwide.Written by : Fairuz Nabila DaniputriReferences :World Economic Forum, 2022. *Why oil prices matter to the global economy: An expert explains*. World Economic Forum. Available at: [Accessed 16 September 2024].U.S. Energy Information Administration, 2022. *Indonesia – International analysis*. U.S. Energy Information Administration. Available at: [Accessed 16 September 2024].McKinsey & Company, 2020. *Oil and gas after COVID-19: The day of reckoning or a new age of opportunity?* McKinsey & Company. Available at: [Accessed 16 September 2024].

Indonesia, renowned for its abundant natural resources, has long been a significant player in the global energy sector. With a thriving oil and gas industry that fuels both its economy and its citizens' needs, the nation stands at a pivotal moment in its quest for energy security and sustainability. Yet, Indonesia's oil and gas industry is not without its challenges. These challenges range from technical hurdles in resource discovery to the unique demands of remote exploration and drilling in challenging terrains. In response to these challenges, SPE ITS SC organized an informative event focused on the upstream section of the oil and gas industry on Saturday, October 21st 2023. This segment deals with exploration and drilling, the fundamental processes that lay the foundation for the industry. Alif Rajendra and Bunga Athira as the Project Officers of this event said that event's primary objective was to provide a comprehensive understanding of exploration and drilling techniques. As well as to close the knowledge gap by explaining the latest drilling technologies, discussing the unique challenges Indonesia encounters, and examining how the oil and gas industry is adapting to meet the growing demand for energy resources.In addition, this would also help in spreading the awareness of the challenges that Indonesia faces regarding the oil and gas industry. “We hope that by organizing this Upstream Series, SPE ITS SC members and ITS students will gain a better understanding of oil and gas science from fundamental to advanced levels, specifically for the exploration and drilling aspect of the industry.” added Bunga. The event featured Mr. Ir. Hadi Ismoyo, the President Director of PT Petrogas Jatim Utama Cendana, as the keynote speaker. He provided valuable insights into various aspects of the industry, including exploration and drilling techniques, the latest cutting-edge drilling technologies, the challenges that Indonesia encounters in its pursuit of energy resources, and the industry's responses to the increasing global demand for oil and gas.One of the event's highlights was the engaging question-and-answer session that followed the presentation. To encourage active participation, the first seven participants to ask questions received special goodie bags as tokens of appreciation from the speaker. Even after this initial round of questions, many participants remained curious and eager to engage with the speaker.These subsequent questions delved into essential topics in the exploration and drilling sector, including the socio-political aspects of the oil and gas industry, not only in Indonesia but also on a global scale. Participants were keen to understand the latest advancements and sustainable practices within the industry, reflecting a growing concern for environmental and ethical considerations in the energy sector.In conclusion, the SPE ITS SC event focusing on the upstream section of the oil and gas industry provided a platform for meaningful dialogue and knowledge sharing. It emphasized the importance of addressing the challenges faced by Indonesia's oil and gas sector in the pursuit of energy security and sustainability.The continued growth and innovation in exploration and drilling techniques, coupled with the industry's commitment to environmentally responsible practices, reflect a positive trajectory for the future. These discussions and exchanges of ideas are crucial steps toward ensuring that Indonesia remains a significant player in the global energy sector while working to build a more sustainable and secure energy future for its citizens and the world.Written By: Arya Nugraha Aulia Rahman Yusup