Analyzing COVID-19's Impact on Offshore Workers & Oil Exploration in 2021
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When the United States shut down in March of 2020, no one really knew how long closures would last or what impact they would have. Workers in every industry were affected, but offshore crews faced unique challenges due to the nature of their jobs and their work environments—where social distancing was nearly impossible. Oil and gas companies were forced to delay turnarounds and postpone new operations. Offshore workers faced high risks of coronavirus exposure when being transported to and from worksites and while working in close contact with other crew members.
More than one-and-a-half years later, the offshore industry is struggling to return to a new normal, with masks, temperature checks, worksite sanitation, and vaccination requirements in place to try to reduce the spread of the coronavirus and the new Delta variant. In the first quarter of 2021, activity levels in the oil and gas sector were 5.1% lower than they were at the end of 2019, before the pandemic hit worldwide.
Production has started to return to normal, but has COVID-19 had any lasting impact on worker safety and oil exploration as a whole? Let’s take a look.
Oil Production & Exploration in 2020-2021
Initial pandemic-related closures had a dramatic impact on onshore and offshore oil production, plus oil prices. In March of 2020, crude oil prices plummeted because of the sudden drop in petroleum demand caused by coronavirus shutdowns. In May of 2020, oil prices reached 30-year lows. Over the entire year, oil production fell by 8%, the most significant yearly decrease ever recorded.
Oil exploration proved more resilient. Despite closures and a lower demand for petroleum, analysts at Rystad Energy predicted approximately 10 billion barrels of oil equivalent (BOE) would be discovered worldwide in 2020. This was a significant drop from the 15.6 BOE discovered in 2019, but higher than the 9.5 billion BOE discovered in 2018. As of October of 2020, there were 73 new discoveries announced. 37 of those were offshore.
Delayed Turnarounds & Their Impact on Worker Safety
COVID-19 restrictions and closures have impacted offshore rigs, refineries, and plants across the U.S. and worldwide. In 2020, many reduced non-critical work and delayed turnarounds and other operations. Delays and restrictions have continued into 2021, begging the question: what happens if a turnaround is delayed for too long? What “non-critical work” could possibly be forgone without disrupting drilling operations?
Turnarounds are one of the most dangerous times for any refinery, plant, or drill site. These complex procedures involve the inspection, repair, and renewal of equipment and machinery. A misstep or overlooked safety standard can cause a fire, explosion, or other disaster. Workers may be at risk of suffering severe burns, chemical exposure, broken bones, and worse. Delayed turnarounds and smaller crews may only increase the risks of an incident that injures or kills workers.
What’s Next for Offshore Workers?
Even with more, cheaper forms of renewable energy, the U.S. Energy Information Administration (EIA) predicts that worldwide petroleum consumption will continue to rise through 2050. For the next several decades (and most likely beyond) offshore crews will keep facing challenging conditions to bring oil and gas to those who need it. Petroleum is a necessity in today’s world; even a global pandemic couldn’t stop production and exploration for long.
Talk to an Offshore Injury Lawyer at Arnold & Itkin
As long as offshore workers are forced to endure unspeakable hardships caused by overlooked safety standards and delayed turnarounds, Arnold & Itkin will fight to set things right. Our offshore injury lawyers believe in helping injured crew members and families who have lost loved ones get answers and just compensation that will help them build brighter futures. We expose wrongdoing by large corporations and their insurance companies, not only to help those who have already been harmed but to prevent others from suffering similar fates.
To find out how we can help you, call (888) 346-5024 for a free consultation.