Thanks to worldwide changes in demographics, attitudes, and costs, the construction industry has to adapt and evolve constantly to stay ahead of the game. The availability of oil is a crucial factor in this. With the cost of oil fluctuating unpredictably, those in the construction industry need to remain aware of the economic climate and adjust accordingly. Let's take a look at some recent changes in the oil industry and consider how construction businesses might be affected.
With an ever-growing worldwide population and an increasing average age, there is an exponential need for fossil fuels or other energy sources. It is predicted that, by 2030, the worldwide population will reach 8 billion, and then increase to 9 billion by 2050. With this growth, the global energy demand is forecasted to double over this time frame.
So, what does that mean for oil production? The answer, of course, varies from country to country. For example, the U.S.A is increasing its domestic oil production in a bid to become self-sufficient. Meanwhile, countries such as China and India, who have less natural resources for oil production, will have to increase their imports to keep up with their countries' growing populations and thriving industries. To mirror these trends, a 40% increase in the worldwide demand for oil is anticipated over the next 20 years.
To keep up with this demand, technology around oil production is becoming more advanced and more widely available. Areas in which technology is helping this industry include:
In previous years, we have been able to track seasonal patterns in the price of oil. Recently however, the cost of oil has become unpredictable. Over 2019 and 2020, the worldwide crude oil prices will average at $67 per barrel. Generally, we have seen the price of oil decline, although there is no certainty that it will continue this way!
Although this price drop will have a negative result for energy companies, decreased fuel costs for individuals could boost customer spending and result in economic growth. To consider this in relation to the construction industry: with lower fuel prices we are likely to see an increase of residential construction projects. This will lead to improved business.
Opinions and attitudes towards the production of oil is another element to consider. Fossil fuels and other environmentally damaging energy sources are becoming begrudged. As a result, many businesses and individuals are now seeking greener energy sources.
Considering the fact that 50% of carbon emissions produced by machinery and production in the UK are attribute to the construction industry, this trend towards greener alternatives needs to be responded to. Not only does this mean that construction businesses are looking towards greener sources of fuel for their projects, but they are also building with green futures in mind. Increased implementation of solar panels and electric charge points are good examples of this. Another move towards greener construction can be found in quality machinery. A high quality and well-maintained cherry picker for example, will negate the costs and emissions used to build new models.
The construction industry has to adapt to many economic and environmental changes in order to maintain business. The attitudes, costs and availability of oil all must be considered and — as these factors are changeable — responded to in record time. With a growing population, and an increased worldwide energy demand, the construction industry needs to stay ahead of the game when it comes to alternative energy sources.