Why is Data the New Oil? - senhasegura (2024)

FAQs

Why is data considered the new oil? ›

The idea that “data is the new oil” has to do with the similarities in how the two resources become valuable. Just like oil, raw data isn't valuable in and of itself; rather, the value is created when it is gathered quickly, completely, and accurately, and connected to other relevant data.

Data Is The New Oil: Meaning

Data helps to create insights that yield valuable results as well as helps companies make more efficient and organized decisions. This in return helps to build a better strategy. Big data companies thrive on this data.

Data is the new oil. Like oil, data is valuable, but if unrefined it cannot really be used. It has to be changed into gas, plastic, chemicals, etc. to create a valuable entity that drives profitable activity. so, must data be broken down, analysed for it to have value.

The analogy its origin likely meant to point out that oil had a revolutionary influence on its era and so does data contemporarily. But people have become increasingly liberal in invoking the analogy. Even companies that have never mined natural resources can unapologetically state that their 'data is the new oil. '

Oil requires lots of resources to be transported while data can go around the world in however many milliseconds. Also, as data is used it becomes more useful rather than becoming exhaust or lost providing light or heat. Thus, assuming data's usefulness is done after using it, like oil, is misguided.

In 2006, Humby coined the phrase “Data is the new oil”. Michael Palmer expanded on Humby's quote by saying, like oil, data is “valuable, but if unrefined it cannot really be used.

Here's how brands need to adapt in order to keep up. When British mathematician Clive Humby declared in 2006 that “data is the new oil,” he meant that data, like oil, isn't useful in its raw state. It needs to be refined, processed and turned into something useful; its value lies in its potential.

That being said, at current consumption, we have by some accounts an estimated 47 years of oil left to be extracted. That equates to somewhere in the region of 1.65 trillion barrels of proven oil reserves. Other sources up this estimate a bit, but most agree we have around 50 years left, give or take.

The main three big oil and gas industry problems that consume money and produce data are discovery, drilling, and producing oil and gas. Data gathered from refineries and routine safety inspections can be used to develop safety predictive analytics.

The reason that U.S. oil companies haven't increased production is simple: They decided to use their billions in profits to pay dividends to their CEOs and wealthy shareholders and simply haven't chosen to invest in new oil production.

Why doesn't the US extract more oil? ›

The U.S. buys Russian oil in part because they produce a certain type of oil that is able to feed refineries in order to make fuel at top capacities. The Biden administration also points to the 9,000 unused gas and oil leases as a major reason why the U.S. can't increase energy production.

The oil glut of 2020 drove crude prices down to -$38 a barrel, forcing U.S. producers to cap wells and lay off workers. Now, oilfield supplies are scarce and expensive and there's a labor shortage. AILSA CHANG, HOST: High gas prices have everyone from truckers to politicians demanding more domestic oil production.

Oil and natural gas are used in everyday products such as lipstick and deodorant and life-saving medical devices, such as MRI machines and pacemakers. Byproducts from oil refining is used to produce plastics, as well as lubricants, waxes, tars and even asphalt for our roads.

To have your oil analyzed, you must take a sample of the lubricant and ship it to a qualified laboratory. Technicians subject the lubricant to a range of tests to determine the concentration of wear metals, fuel dilution, the lubricant's total base number (TBN), oxidation and other information.

Data = Knowledge. Good data provides indisputable evidence, while anecdotal evidence, assumptions, or abstract observation might lead to wasted resources due to taking action based on an incorrect conclusion.

More Data = More Detailed Results

So immediately, the business wants answers that explain why or how the situation is happening.

#1 For Informed Decision-Making

This is because data is equivalent to knowledge. Thus, owning good data serves as indisputable evidence or justification for a decision – it allows leaders to say, “we've done x because of y.” Essentially, good data is persuasive in and of itself.

Oil has reigned for centuries as one of society's most valuable resources. Throughout history, those who have controlled oil, have controlled the economy. However, in today's “data economy,” it can be argued that data, due to the insight and knowledge that can be extracted from it, is potentially more valuable.

“Data is the new oil. Like oil, data is valuable, but if unrefined, it cannot really be used. It has to be changed into gas, plastic, chemicals, etc. to create a valuable entity that drives profitable activity.

In 2006, mathematician Clive Humby coined the phrase “data is the new oil.” Since then, it's taken off like wildfire. Today, data fuels business actions, customer experience, new healthcare discoveries and fundamentals in every conceivable industry.

Why is data the most valuable resource? ›

Why Data Is So Valuable. Data has become a valuable commodity, similar to commodities like oil and gold, because most companies have similar types of data available to them. But, of course, there are also many different types of data, and different data holds different value for various companies.

What changed for this to happen? According to The Economist magazine, in the article “The world's most valuable resource is no longer oil, but data”, the power and influence that data holds for technology companies today has the same value as the dominance of large oil companies in the early twentieth century.

Back in 2017, The Economist published a story titled, “The world's most valuable resource is no longer oil, but data.” Since its publication, the topic has generated a great deal of discussion, and “Data is the new oil” has become a common refrain.

You see, the U.S. does produce enough oil to meet its own needs, but it is the wrong type of oil. Crude is graded according to two main metrics, weight and sweetness. The weight of oil defines how easy it is to refine, or break down into its usable component parts, such as gasoline, jet fuel and diesel.

Oil Reserves in the United States

The United States has proven reserves equivalent to 4.9 times its annual consumption. This means that, without imports, there would be about 5 years of oil left (at current consumption levels and excluding unproven reserves).

The United States is one of the largest crude oil producers

U.S. oil refineries obtain crude oil produced in the United States and in other countries. Different types of companies supply crude oil to the world market.

Data can help businesses measure whether certain actions, products or services are profitable and where their greatest expenses might be. Identifying expenses is often the key to increasing profits because businesses can reduce those expenses and keep more of the revenue they earn.

US Crude Oil Field Production is at a current level of 12.30M, up from 12.20M last week and up from 11.90M one year ago. This is a change of 0.82% from last week and 3.36% from one year ago. US Oil Production measures the daily number of barrels produced in the United States in oil fields.

The use of big data analytics has helped the oil & gas industry to optimize the drilling processes by customizing the predictive models. Such highly customized predictive models can help businesses to predict probable equipment failures.

Where does the US get its oil? ›

The resulting total net petroleum imports (imports minus exports) were about -1.26 million b/d, which means that the United States was a net petroleum exporter of 1.26 million b/d in 2022. The top five source countries of U.S. gross petroleum imports in 2022 were Canada, Mexico, Saudi Arabia, Iraq, and Colombia.

Venezuela - 303.806 Billion Barrels

Venezuela holds the largest oil reserves globally, with over 300 billion barrels mainly located in the Orinoco Belt at the southern end of the eastern Orinoco River Basin.

It often makes more sense for the refineries in the gulf to export some of their gasoline to Mexico, rather than expensively ship their product all the way to the east coast of the U.S., which gets cheaper gasoline from Europe. oil prices down which keeps prices in the U.S. lower.

At the time of the embargo, U.S. policies encouraged oil imports over domestic oil production. In response to the embargo and higher domestic gasoline prices, Congress passed the 1975 Energy Policy and Conservation Act, which directed the president to ban crude oil exports except for select types of oil.

The United States has adequate refinery capacity to process its current and projected crude production, however the free world oversupply of refining capacity will persist through the few remaining years of increasing world crude oil production and thereafter.

In 2021, oil refinery capacity in the United States amounted to approximately 17.9 million barrels per day. Although refineries are operating at full capacity, they may still have difficulties in meeting daily energy demands.

Crude oil prices are determined by global supply and demand. Economic growth is one of the biggest factors affecting petroleum product—and therefore crude oil—demand. Growing economies increase demand for energy in general and especially for transporting goods and materials from producers to consumers.

By 1906, that number was 126 million barrels per year. Today, the U.S. produces about 6.8 billion barrels of oil every year. According to OPEC, more than 70 million barrels are produced worldwide every day. That is almost 49,000 barrels per minute.

The transportation sector accounts for the largest share of U.S. petroleum consumption.

What do we need oil for? ›

Some of the more obvious petroleum products include transportation fuels, fuel oils for heating and electricity generation, asphalt and road oil.

Three sampling procedures commonly associated with engine oil sampling include: sampling a pressurized line before the system filter; using a drop tube in the dipstick tube; and procuring a sample midstream from a drain port while draining the engine.

Oil analysis is a routine activity for analyzing oil health, oil contamination and machine wear. The purpose of an oil analysis program is to verify that a lubricated machine is operating according to expectations.

Oil analysis provides an in-depth view of the lubricant in your machinery. With consistent oil testing, small issues can be identified and dealt with before they become big problems. Certain types of wear in specific areas of the equipment are detected through oil analysis.

The analysis will tell whether the oil has experienced excessive water contamination. The lab may also look at the acid and base numbers. Acid levels indicate the extent to which the oil is overheating or oxidizing.

Executive Summary. Akin to oil, which powered the age of industrialization, data is the core resource that will fuel the Fourth Industrial Revolution, also known as the digital age that is distinct by the speed of technological breakthroughs.

Big data analytics assists in streamlining key oil and gas operations, such as exploration, drilling, production and delivery, in the three sectors – upstream, midstream and downstream.

Data has never been more important.

We are living through the new digital age, meaning data is more valuable than ever before. Various industry experts have begun using the phrase “data economy” to describe the influence and prominence of big data in today's society, for, without it, society would grind to a halt.

Data is no longer just a byproduct of our digital activities; it has become a valuable commodity that fuels the digital economy. In fact, data is often referred to as the new oil, as it powers the engines of innovation and growth in the digital age.

Natural gas, coal, and oil are non-renewable sources of energy, and our reserves are constantly getting emptier.

When did data become more valuable than oil? ›

Back in 2017, The Economist published a story titled, "The world's most valuable resource is no longer oil, but data." Since its publication, the topic has generated a great deal of discussion, and "Data is the new oil" has become a common refrain.

That is why data pipelines are critical. They eliminate most manual steps from the process and enable a smooth, automated flow of data from one stage to another. They are essential for real-time analytics to help you make faster, data-driven decisions.

Oil and gas enterprises can employ big data predictive analytics to reduce downtimes and maintenance costs of the refining equipment, thus improving asset management.

Data pipelines, by consolidating data from all your disparate sources into one common destination, enable quick data analysis for business insights. They also ensure consistent data quality, which is absolutely crucial for reliable business insights.