As I look back at 2016 and the local developments in Houston because of the drop in oil prices, and the confidence in general about the economy, it is very hard to predict what will be the most critical aspects for barge operating and barge fleeting for 2017. The biggest concern is the impact of continued lower oil prices on the oil field service sector as it is the consumer of transportation and logistics services. Having a new administration may help bring back offshore drilling and create a need for services from the marine sector, as well as a possible infrastructure investment from the public sector.
A rebound in offshore drilling is very uncertain due to the actual demand for oil during this period, and the investment requirements of the oil companies. A major infrastructure bill from the federal government will not be fast or have a major impact in 2017, but if it is passed, it will impact the country for many years to come, depending on the scope of the bill; again, great uncertainty.
Regulatory issues are impacting our industry everyday with some positives and negatives, depending on what side of the agenda your company is on. In the case of fleeting areas in Houston, we see an increase of regulatory oversite by both the US Coast Guard and US Army Corp of Engineers. There is a growing need for barge fleeting, but developing the commercial aspects of this business can be very slow while working through the regulations. To improve this, greater awareness by the regulators of commerce would be a good place to start.
The declining levels of global trade are an indicator that there is an increased focus on domestic economies worldwide, ex. Brexit. Knowing that this will continue to impact the transportation and logistics industry, not only worldwide but locally, my outlook for 2017 is one of caution and careful consideration of opportunities in the next 18 months.