It goes without saying that today’s society heavily relies on the energy sector to fuel households, businesses, and essential infrastructure, while also promoting economic development and social stability. However, the dependence that we as a society have on the industry, renders it susceptible to cyber threats, which are further amplified by geopolitical conflicts, vulnerabilities in operational technology, and the rising occurrence of natural disasters.
According to the ‘Cost of a Data Breach 2023’ report by IBM, the global energy sector set a new record in 2022, with an average data breach cost of US$4.72m. Malicious cyber actors often target essential infrastructure, with a particular focus on utilities such as gas, water, and, most notably, power utilities.
Challenges with cybersecurity in the energy sector
The increasing nature and frequency of cyber threats demand a significant shift from reactive to proactive threat mitigation strategies. Advanced persistent threat (APT) groups, known for their prolonged and targeted attacks, are focusing their attention towards energy companies. Simultaneously, the rise in ransomware attacks poses substantial risks to the operational integrity and sensitive data of these firms.
Further complicating matters are nation-state-affiliated attack groups that exploit geopolitical instability and use it to conceal and amplify their activities. These disruptions extend well beyond the digital realm, impacting economies, public safety and national security.
As reported in an article by Dataminr, a case in point of this was the 2019 Saudi Aramco drone strike, which brought half of Saudi Arabia’s oil production to an abrupt halt, sending ripples throughout global oil markets. Similarly, the sabotage and subsequent leaks of the Nord Stream gas pipeline heightened tensions between Russia and the West, revealing the vulnerabilities of energy supply chains.
Unfortunately, cyber attacks do more than just disrupt operations; they also have substantial and often crippling financial consequences. This results in an attack significantly impacting commodity prices and stock values, thus impacting worldwide trading markets. In layman's terms, a single disruption can cause a huge chain reaction that extends beyond the energy sector to affect the broader economy.
The widespread and far-reaching repercussions of these cyber attacks underscore the vital importance of energy companies adopting a comprehensive and proactive strategy for effectively identifying, preventing, and responding to these threats. As the frequency and sophistication of threats increase, regulatory bodies around the world are also updating their frameworks and guidelines to enhance the industry's resilience.
The multifaceted challenge of cyber-physical risks
When cyber and physical threats come together within the energy sector, the resulting issue is extremely complex. To overcome this requires a comprehensive, multifaceted security strategy. A study commissioned by Dataminr revealed that among security leaders in energy and utilities companies, 56% highlighted the importance of establishing technological resilience as their top concern. This involves not only the protection of their organisation’s data but also complying with data localisation mandates and securing IT/OT systems and digital assets, which explains the ongoing annual growth in cybersecurity expenditure within the energy sector until 2025, with AI playing a pivotal role.
Undoubtedly, AI tools offer significant advantages by rapidly analysing vast datasets, pinpointing vulnerabilities, and enabling swift corrective measures to prevent potential harm. By identifying anomalies and predicting potential threats, AI not only strengthens digital infrastructure but also bolsters the secure management of physical and digital assets.
In conclusion, Dataminr recognises the crucial significance of proactive threat identification and response within the energy sector. While the challenge is intricate and the consequences substantial, the company’s goal remains straightforward: to provide the earliest warnings of cyber threats and incidents through real-time alerts covering digital risk identification, external attack intelligence, vulnerability prioritisation, and cyber-physical risks.
Dataminr’s real-time AI platform detects high-impact events, risks and critical information from public data signals. Recognised as one of the world's leading AI companies, Dataminr enables faster real-time response and more effective risk management for public and private sector organisations including multinational corporations, governments, NGOs, and newsrooms.