Cash in the barrel 2013

Working capital management in the oil and gas industry

  • Share

Global oil and gas companies continued to improve their working capital (WC) performance in 2012.

Overall, our research findings suggest that most companies in our study still have huge opportunities for improvement in many areas of WC, including:

  • Supply chain planning
  • Demand management
  • Scheduling and inventory management
  • Billing, collection and payment terms
  • Joint-ventures payment arrangements
  • Contractor management
  • Sourcing

Our experience in the oil and gas industry confirms that a dedicated focus on WC management could release additional cash flows totaling tens of billions of US dollars across the companies in our survey, given that their aggregate levels of gross WC — defined as the sum of trade receivables, inventory and accounts payable — amount to some US$750b.


This report is based on a review of the WC performance of the largest 31 oil and gas companies (by sales) headquartered in the US and Europe. The insights are derived from an analysis of publicly available annual and quarterly sources of information. The oil and gas companies in the sampling include integrated (11), independent E&P (8), independent R&M (4) and oilfield services companies (8).