We develop our own tools and models through our Energy Insights group to generate a number of proprietary analyses and forecasts. This allows us to support our clients with market diligence, project evaluation, portfolio analyses, business planning and optimization, among other challenging decisions.
Setting the right operating strategy is critical to achieving consistent profitability. We help clients assess downstream market fundamentals to identify strategic opportunities and build capabilities in advanced analytics and fact-based problem solving to boost their agility, confidence, and competitive edge.
At the same time, we help clients sustain top-quartile operational performance while adhering to sound operating principles and maintaining high health, safety, and environmental standards.
What we do
McKinsey's track record as a trusted advisor to the industry is second to none. Since 2007, we have served 70 percent of the global top 50 oil and gas companies in more than 500 projects on downstream strategy and operations.
Our experience across all industries and regions gives us deep insight into what it takes to achieve operational excellence. We engineer organizations for success by addressing technical systems, management infrastructure, capabilities, and mindsets together in an integrated approach.
How we work
We have an extensive global network of downstream specialists—comprising more than 250 consultants who are supported by experts, analysts, and external advisors. To stay ahead, we invest in developing approaches, tools, and data sets across the downstream value chain, including refining capacity, crude and product supply and demand, and equilibrium pricing. To bring clients the best thinking, we develop global, regional, and functional perspectives and explore industry hot topics.
Building capabilities is central to creating lasting change. We help clients develop their people through on-the-job coaching, off-site workshops, in-house academies, and our Green Campus mini-refinery.
Examples of our work
Our recent downstream projects for oil and gas companies include:
- helping an Asian national oil company overcome challenges in management systems, culture, and leadership at its refineries by building teams of skilled change agents and piloting a new management process. The project identified operational improvements worth more than $700 million
- working with an oil refiner to benchmark and transform performance at several sites, leading to an advance of two or three quartiles by each refinery and the development of initiatives to capture more than $400 million a year in revenue and cost savings
- advising a major oil and gas company on an entry strategy for the Chinese lubes market, culminating in a three-year plan, prioritized markets and segments, and a target to double volumes annually in the first three years
We develop our own tools and models to diagnose and streamline operating practices, such as:
- Global Energy Perspective, a granular long-range model covering 21 regions, 34 fuel types, and 25 sectors that enables users to run scenarios and improve their understanding of energy demand and the microeconomic factors that drive it.
- Global Downstream Model, a country-level model providing a comprehensive view on future downstream markets, including global and regional refining conditions, inter-regional crude and product flows, and regional product balances.
- Oil Markets Pricing Service provides a consistent and comprehensive set of crude and refined product prices for major product markets. This allows clients to create a tailored set of price outlooks to address market uncertainties. This service can be accessed at different levels, from companies who want to have a third party market outlook, to companies that want to access the tools and create their own price projections.
- Optimization Diagnostic Service, we help clients evaluate how their refining strategy drives optimization processes, tools, and capabilities. We conduct a detailed assessment of the linear programming (LP) model to identify areas for improvement. In addition we can identify the quality of optimization processes, such as crude selection, crude valuation, and back casting.
- Energy Insights, which combines our analytical models, benchmarking capabilities, and proprietary insights for critical decisions on strategy, investment, and performance.