Deloitte identifies offshore trends driving competitiveness in 2026

In late October, Deloitte released its 2026 Oil & Gas Industry Outlook, which identified five trends that could help oil and gas companies improve performance and differentiation:

1. Growth priorities: Oil and gas companies are expected to balance navigating policy tailwinds and industry realities while retaining capital discipline.
2. Cost pressures: The sector will likely continue developing and implementing strategies that strengthen supply chains to mitigate tariff-driven cost increases.
3. Scaling US LNG: Leveraging LNG’s position as a transition fuel, US exports could potentially triple by 2030, and the industry must prepare.
4. Digital transformation: Much of the industry is moving from pilot projects to fully deployed and scaled digital platforms to speed processes and scale operations.
5. Downstream resilience: Oil and gas companies are rebuilding downstream resilience by strengthening margins through feedstock optimization and renewable fuels.

Offshore spoke with Zillah Austin, Deloitte's vice chair and US energy and chemicals leader, about how evolving US energy and trade policies, LNG export growth and global sustainability standards are driving offshore oil and gas operators to adapt through procurement strategies, infrastructure scaling, digital transformation, cybersecurity measures, feedstock optimization and emissions-reduction technologies to remain competitive.

Offshore: How do recent US energy and trade policy shifts specifically impact offshore oil and gas operations in regions like the Gulf of Mexico?

Offshore: Tariff-driven cost increases have challenged supply chains. How are offshore projects adapting procurement strategies to mitigate these risks?

Austin: I have observed that offshore operators are deploying several strategies to navigate tariff-related cost pressures, each with distinct trade-offs:

• Re-sourcing supply chains: Many companies are increasingly shifting procurement to non-tariffed suppliers to minimize (or manage) costs. While this approach can deliver savings, it can also extend lead times, creating new schedule risks even as cost stability improves.
• Localizing manufacturing: With approximately 40% of oil country tubular goods (OCTG) historically sourced from foreign suppliers, operators are increasingly adopting dual-sourcing strategies or expanding domestic manufacturing capacity.^[4] This shift could strengthen supply chain resilience but may require higher inventory levels and greater working capital commitments.
• Contractual innovations: Growing cost uncertainty is likely to drive new procurement approaches. Operators are negotiating index-linked pricing, escalation clauses and strategic pre-buy agreements to manage volatility. However, these mechanisms primarily redistribute risk rather than eliminate it—someone in the value chain must ultimately absorb the cost increases.
• Investment implications: The cumulative impact is tangible. Industry estimates suggest up to $50 billion in offshore greenfield projects could face deferral if price volatility continues. This cautious capital deployment reflects operators' need for greater cost certainty before sanctioning major deepwater developments.

Offshore: With US LNG exports projected to triple by early 2030s, what infrastructure and offshore capabilities need to scale to support this growth?

Austin: I believe growing US LNG exports over the next decade will require a comprehensive infrastructure buildout across the entire value chain.

US LNG exports are expected to grow by 25% in 2025 and 7% in 2026, with volumes potentially doubling by 2030 and nearly tripling by the early 2030s if all approved projects proceed.^[5]

This growth necessitates substantial midstream investment. Gas gathering and processing facilities must expand, while pipeline networks need scaling to handle increased throughput. LNG storage tanks are being constructed alongside new facilities, and the global LNG carrier fleet is expanding to meet shipping demand.

Port capacity may emerge as a critical constraint. Accommodating increased LNG vessel traffic could require deeper navigation channels, expanded berthing capacity and upgraded marine infrastructure. 

One project in development would utilize a brownfield deepwater port to support up to three floating LNG (FLNG) vessels. That project is targeting a final investment decision later this year. If approved, the project would likely require tugs, supply boats and possibly specialized vessels for maintenance, personnel transfer and logistics.

Offshore: What are the most impactful digital technologies being deployed at scale in offshore operations—AI-driven predictive maintenance, digital twins or real-time monitoring?

Austin: AI-driven predictive maintenance is gaining traction, supported by results showing 140 hours of avoided downtime, up to 40% fewer failures and around US$10 million per year in savings in early deployments. This may help offset cost inflation, though it potentially increases reliance on data integrity and cyber resilience.

Digital twins may provide material benefits in design optimization and operations, yet their adoption could be slowed by integration complexity when legacy systems or inconsistent data architectures are involved.

Real-time monitoring and edge analytics may enhance system-wide visibility but could also widen the cyber-attack surface, implying the need for more rigorous OT-IT controls.

Offshore: Feedstock optimization and renewable fuels are key to downstream resilience. How do these strategies influence offshore production planning?

Austin: Gulf Coast refining margins have fallen more than 50% from 2022 peaks, while D4 RIN prices declined 38% before partial recovery.[6] This may encourage refiners to optimize feedstock slates more aggressively, implying that offshore crude quality and blendability could influence development sequencing.

With ~400 kb/d of refinery closures and ~120 kb/d of renewable conversions expected in the near term, total US refining capacity may decline by roughly 3%, potentially intensifying competition among crude streams.^[7] Offsetting this, renewable diesel output is projected to approach 250 kb/d by 2026, which may reward lower-carbon barrels and cleaner production profiles.

These trends suggest that offshore projects with lower emissions intensity may be better positioned in some sector and end markets. 

Conclusion