More competition in larger FICs. Concentration of activities in smaller FICs to achieve economies of scale. Perceived high in-country risks resulting in high ROI guaranteed to oil companies. Critical analysis of potential saving of alternatives to current practices taking into account total cost implications. Local prices may not reflect real world prices.
Some formulae rely on specific cargo prices or short duration 'snapshots' of world prices.
Move towards full monthly averages of world market price. Local prices out of step with published world prices. Delayed application of world pricing is due to reliance on historical data and is only a problem when world prices fall dramatically in a short period. Reduce delay by negotiation with oil companies but delays are self correcting when world prices rise.