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The oilfield services market size is forecast to increase by USD 43.46 billion at a CAGR of 5.5% between 2023 and 2028. The Oilfield Services (OFS) market is experiencing significant growth due to the increasing global demand for oil and natural gas, particularly from shale gas plays and offshore assets. Technological innovations, such as mass production of equipment for horizontal drilling and fracking, are driving productivity in the oilfield services sector. However, fluctuations in crude oil prices pose a challenge to market growth. Shale plays, oil sands, and high-density drilling operations require the use of sand particles in large quantities, leading to a higher demand for equipment repair and maintenance in the upstream service sector. The offshore assets segment also presents opportunities for OFS companies due to the rising number of offshore contract drilling projects.
Manufacturing and maintenance of equipment are key areas of focus for OFS providers to ensure efficient and cost-effective oil extraction.
The market is driven by the exploration and production of hydrocarbons, particularly gas reserves, in response to the supply-demand gap in the global energy market. Advanced technology tools play a crucial role in the industry, enabling efficient drilling, completion, and remedial operations. The market is influenced by various factors, including oil prices, geopolitics, and new technologies. Drilling fluids, completion fluids, and remedial fluids are essential components of oilfield production, ensuring the safe and effective transportation of water and materials and equipment. Equipment maintenance, repair, and manufacturing are integral to the industry's success, with a focus on reducing production costs and increasing operational efficiency.
Moreover, the International Energy Agency and OPEC countries closely monitor the market, with the offshore sector experiencing significant growth due to the increasing demand for hydrocarbons and the availability of advanced technologies. The transportation of hydrocarbons remains a critical aspect of the industry, with a focus on optimizing logistics and reducing environmental impact. Overall, the market is a dynamic and complex ecosystem that requires continuous innovation and adaptation to meet the evolving needs of the global energy industry.
The market research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in "USD billion" for the period 2024-2028, as well as historical data from 2018-2022 for the following segments.
The onshore segment is estimated to witness significant growth during the forecast period.In the market, framework agreements have become increasingly common as major oil and gas companies seek to secure long-term relationships with service providers. In 2023, the onshore segment of this market accounted for a significant share due to the high volume of drilling and production activities, as well as lower capital requirements compared to offshore fields. The growth of the onshore segment can be attributed to the increasing demand for crude oil production and the implementation of advanced drilling technologies, such as directional drilling services and high-pressure wellbore intervention.
Additionally, the focus on developing new projects in regions like North America and the Middle East, driven by the depletion of older fields, is contributing to the market's expansion. Companies like Baker Hughes Company, Halliburton Company, and Weatherford International Plc provide essential services such as drilling fluids and completion fluids to support these projects. The global energy industry's ongoing quest for crude oil production, coupled with the need to optimize production from oil sand reserves and ensure efficient oil transport, continues to fuel the demand for oilfield services.
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The onshore segment was valued at USD 118.19 billion in 2018 and showed a gradual increase during the forecast period.
North America is estimated to contribute 46% to the growth of the global market during the forecast period. Technavio's analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.
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In the market, framework agreements have become increasingly common in 2023, with major players such as Equinor, Baker Hughes Norge, Schlumberger Limited, Baker Hughes Company, Halliburton Company, and Weatherford International Plc securing long-term contracts for drilling growth in North America. The region's crude oil production experienced a significant boost due to the recovery of crude oil prices and the expansion of shale oil production in the US. Advancements in technology, including automation and IoT, have influenced the oil and gas industry's shift towards automated drilling solutions. These technologies enable onshore and offshore oil and gas projects to operate more efficiently, even in challenging environments with high pressure and harsh weather conditions.
For instance, semi-automated technologies have become essential for accessing remote offshore oil wells, which often face logistical hurdles such as extreme weather. Moreover, the adoption of advanced drilling fluids and completion fluids has facilitated the drilling process, ensuring the safety and productivity of oil and gas operations. As oil sand reserves continue to be a significant source of crude oil production, oil transport remains a crucial aspect of the market. The market is expected to grow further as companies invest in technology and innovation to optimize their operations and reduce their breakeven prices.
Our researchers analyzed the data with 2023 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
Growing demand for oil and natural gas globally is the key driver of the market. The market is experiencing significant growth due to the increasing demand for hydrocarbons, particularly oil and natural gas. According to the US Energy Information Administration, the average price of liquid fuels reached USD 105 per barrel in 2022. This trend is expected to continue, driven by the rising demand for energy, with over 70% of this growth coming from oil, natural gas, and coal. As traditional oil and gas reserves continue to mature or deplete, there is a growing need to explore and produce new reserves, including unconventional resources such as shale fields. Advanced technology and tools are playing a crucial role in this process, enabling the extraction of hydrocarbons from previously inaccessible reservoirs.
Moreover, the geopolitical factors, supply-demand gaps, and new technologies are also influencing the market. Operating companies are investing heavily in new production methods and technologies to reduce production costs and meet the increasing demand for crude oil and natural gas. The global economy and the overall demand for hydrocarbons are key drivers of this growth, with the market expected to continue expanding in the coming years.
Technological innovations to drive productivity in oilfield services market is the upcoming trend in the market. The market is experiencing significant changes as companies seek to enhance productivity and profitability amidst pricing pressures from oilfield operators and E&P companies. To address these challenges, oilfield service providers are embracing advanced technology, investing in high-performance tools and systems, and automating oilfield processes. For instance, some providers are exploring automated drilling capabilities to decrease labor costs and optimize operations. Nabors Industries, a leading oilfield services company based in Houston, US, has introduced the Nabors iRig drilling system for onshore drilling, featuring an automated drill pipe handling system. Furthermore, the industry's focus on hydrocarbon reserves, both conventional and unconventional, such as shale fields, is driving innovation in response to the global economy's supply-demand gap and crude oil demand.
Moreover, geopolitics also plays a role, as new technologies and production cost reductions help mitigate the impact of oil price volatility. Overall, the oilfield services sector is adapting to meet the evolving needs of the industry, ensuring the continued extraction and production of barrels per day.
Fluctuations in crude oil prices is a key challenge affecting the market growth. The market has been significantly influenced by various factors, including fluctuations in gas reserves, advanced technologies, and production costs. In 2023, the average crude oil price declined to USD82.41 per barrel from USD97.05 per barrel in 2022. The price reached a record high of USD115 per barrel in 2022, but geopolitical tensions, such as the Russia-Ukraine war and the Israel-Palestine conflict, and the COVID-19 pandemic led to a supply-demand gap, causing prices to decrease. This negatively impacted the profitability and performance of upstream oil and gas companies, resulting in several projects being canceled or postponed worldwide. New technologies, such as those used in the production of hydrocarbons from unconventional reserves like shale fields, have helped mitigate some of the challenges faced by the industry.
However, the global economy and crude oil demand continue to influence the market, with barrels per day production remaining a critical indicator of market health. Operating companies must navigate these complexities to remain competitive and profitable in the market.
The market forecasting report includes the adoption lifecycle of the market, covering from the innovator's stage to the laggard's stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market growth analysis strategies.
Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Baker Hughes Co: The company offers drilling services, well integrity and intervention, plug and abandonment, and decommissioning of oil and gas infrastructure.
The market research and growth report includes detailed analyses of the competitive landscape of the market and information about key companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The market is a critical sector in the global energy industry, focusing on the exploration, production, and transportation of hydrocarbons from conventional and unconventional reserves. The market is driven by various factors, including gas reserves, advanced technology tools, and the supply-demand gap in the oil market. Geopolitics, new technologies, production cost, and hydrocarbon prices also significantly impact the market. Upstream service companies provide a range of services, including drilling growth, directional drilling services, pressure pumping services, wireline services, well intervention services, coiled tubing services, and equipment rental. These services are essential for the mass production of shale oil, shale gases, and crude oil from both onshore and offshore assets.
Moreover, the market is characterized by the use of advanced technologies such as hydraulic fracturing, stimulation techniques, and shale gas extraction. Operating companies rely on customized packages of services, equipment rental, field operation, analytical services, and materials and equipment to optimize oilfield production. Equipment maintenance, safety and security, and offshore greenfield investment are crucial aspects of the market. The market also includes manufacturing, maintenance, and equipment repair services for offshore assets. The international energy agency reports that energy demand, especially for crude oil and crude oil products, continues to rise. Offshore discoveries and drilling activities in shale plays, offshore contract drilling, and horizontal drilling are increasing, leading to higher drilling costs and the need for cost-effective solutions.
Similarly, the offshore sector faces challenges such as high pressure, wellbore intervention, and transportation of water, drilling fluids, completion fluids, and remedial fluids. Companies such as Equinor, Baker Hughes Norge, Schlumberger Limited, Baker Hughes Company, Halliburton Company, and Weatherford International plc provide various services to address these challenges. The energy cost, well productivity, reservoir performance, and low-stress environment are essential factors for oil extraction and transportation. The market is also influenced by the global economy, crude oil prices, and the breakeven price for oil sand reserves. In conclusion, the market plays a vital role in the global energy industry by providing essential services for the exploration, production, and transportation of hydrocarbons from various reserves. The market is driven by various factors, including technological advancements, geopolitics, and the global economy, and is characterized by the use of advanced technologies, customized packages, and cost-effective solutions.
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Market Scope |
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Report Coverage |
Details |
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Page number |
173 |
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Base year |
2023 |
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Historic period |
2018-2022 |
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Forecast period |
2024-2028 |
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Growth momentum & CAGR |
Accelerate at a CAGR of 5.5% |
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Market growth 2024-2028 |
USD 43.46 billion |
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Market structure |
Fragmented |
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YoY growth 2023-2024(%) |
4.13 |
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Regional analysis |
North America, Middle East and Africa, APAC, Europe, and South America |
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Performing market contribution |
North America at 46% |
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Key countries |
US, Canada, Saudi Arabia, China, and Russia |
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Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
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Key companies profiled |
Baker Hughes Co., Calfrac Well Services Ltd., Caterpillar Inc., Champion Oilfield Service, China Oilfield Services Ltd., Expro Group Holdings NV, Helmerich and Payne Inc., Huawei Technologies Co. Ltd., Key Energy Services Inc., Nabors Industries Ltd., Nexans AmerCable, Oil States International Inc., Patterson UTI Energy Inc., Proserv UK Ltd., Saipem S.p.A., Schlumberger Ltd., Superior Energy Services Inc., Archer Ltd., Halliburton Co., NOV Inc., and TechnipFMC plc |
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Market dynamics |
Parent market analysis, market growth inducers and obstacles, market forecast, fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, market condition analysis for the forecast period |
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Customization purview |
If our market report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Application
7 Market Segmentation by Type
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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