Oilfield Services Market Research Report - Forecast to 2030

Oilfield Services Market Research Report: Information by Service (Seismic, Drilling, Characterization, Completion, Production, Well Intervention, and Others), Application (Onshore & Offshore) and Regions (North America, Europe, Asia-Pacific) – Forecast till 2030

ID: MRFR/E&P/5370-HCR | February 2021 | Region: Global | 185 pages

Oilfield Services Market overview:

Oilfield Services Market is projected to be worth USD 359.57 Billion by 2028, registering a CAGR of 6.45% during the forecast period (2022 - 2030), The market was valued at USD 273.41 billion in 2020.

The Oilfield Services include manufacturing, maintenance, and repairing of the oil extracting pieces of equipment. The service also includes operations like locating the energy sources, drilling and evaluating the oil sources, managing data, and maintenance of the hole for future extraction. Several new technologies in extraction have fueled the Oilfield Services Market value. Several operators choose to combine hydraulic fracturing and horizontal drilling techniques to gain access to oil and gas reserves from low-permeable geological formations.

Multiplying production units while decreasing the cost incurred is the key factor in the field operation. Several Oilfield Services industries offer a range of customized packaging for the operator to save on costs. Renting or leasing the equipment and providing the required services like evaluation, construction, and maintenance of oil and gas wells are the major types of the industry. After drilling the well, key maintenance operations like logging, cementing, casing, perforating, and fracturing must be rendered for continuous oil or natural gas extraction. The advent of new technologies has increased the overall efficiency of the Oilfield Services Industry. Additionally, matured companies have shifted to automated or similar other new technologies which offer higher accuracy, precision while reducing the production costs and labor costs.

COVID 19 Analysis:

Key market players in the US have reduced their staffing owing to the worldwide lockdown. Over 27% of Onshore drilling rigs remain inactive and over 23% of frac crews were put inactive in recent years. Also, the Oil and gas industries across the globe were disrupted owing to the declining financial and commodity markets due to this pandemic. As governments of several developed countries have imposed restrictions in movements, the demand for oil and gas has drastically reduced, which has therefore hampered the production and supply chain operations in the oil and gas industries. Major Oil and Gas exploring operators have shut down their exploration activities as they are against the COVID norms imposed by the government.

The oil market crisis has exasperated the capital market, propelling matured oil companies to cancel or defer about $41 billion in planned capital expenditures. Additionally, the unexpected oil price war between Russia and Saudi Arabia has created a stumbling block for the Oilfield Services Market growth. The war owing to the outbreak of COVID19 has slashed the production quantity, though several flexible business strategies were carried out to better the market opportunities.

Competitive landscape:

  • Schlumberger (Texas)

  • Halliburton (Texas)

  • Baker Hughes (Texas)

  • Weir Oil and Gas (Glasgow)

  • Emerson (United States)

  • National Oilwell Varco (United States)

  • Weatherford (United States)

  • AlMansoori Specialized Engineering (UAE)

  • Saudi Aramco (Saudi Arabia)

Recent developments:

In the year 2020, an application based on artificial intelligence enables the operators to view the production data and offers the parameters to predict future production precisely. This application was made available for the global oil and gas sector.

Multilateral drilling enhances the production rate as oil and natural gas might present at separate layers. Single well-radiating branches from the main borehole enable the operator to tap the reserves located at different depths.

Halliburton has secured a contract with Energean to conduct well drilling and completion assignments for 3 years. It uses wireline logging solutions to accurately measure well data and evaluate potential of wells.

Archer, a leading oilfield services company is all set in completing the previously announced acquisition of rival DeepWell. DeepWell offers downhole and wireline services to oil companies on the NCS (Norwegian Continental Shelf). The company commands one of the most modern wireline unit fleets on the Norwegian Continental Shelf and also holds a strategic long-term contract in the light well intervention market. 

Market dynamics:

Market drivers:

Extraction of Shale Gas:

Shale Gas extraction that involves nitroglycerine was prevalent during the 1860s. However current technologies especially hydraulic fracturing are utilized to extract the shale gas, which involves water pressure to crack open the rocks allowing the gas to flow through the rocks and travel back up to the borehole. Shale gas is one of the prominent eco-friendly fossil fuels that help in decarbonization. Such a positive feature of shale gas has exasperated its extraction activities and thereby increased the Oilfield Services Market value.

Advancement in technology:

Several energy-efficient technologies with minimal effect on the environment have propelled the Oilfield Services Market growth in recent years. Also, the increasing demand for oil and gas in various sectors has stimulated the major market players to invest in the market. The novel technologies such as directional drilling, horizontal drilling which can serve both conventional reservoirs and unconventional reservoirs, effective pieces of equipment like downhole sensors, steerable downhole motors are primary drivers of Oilfield Service Market growth.

Market Opportunities:

Oil price is expected to bounce back:

Due to COVID 19 and restriction in movement, currently, the Oil and gas industry is suffering a sharp decline. Prices of oil and gases have slashed significantly due to the Oil price war between Russia and Saudi Arabia. However, we expect the oil prices to bounce back, as currently, it's rallying towards USD 80 per barrel. Researches in the bank of America states that the prices would reach up to USD 100 by May 2022.

Discoveries of New oilfields:

Several new oilfields were discovered in recent years, a field of about 2400 sq. km was discovered in Iran's province of Khuzestan. The field was estimated to contain 155.6 billion barrels of crude oil. Additionally, the ongoing deep-water oil and gas exploration in the basins of the Atlantic Ocean and the giant reservoirs in Brazil, Western Africa, Gulf of Mexico have projected opportunities in the Oilfield Services industry.

Market Restraints:

Currently, the pricing of oil and gas is witnessing series of fluctuations due to various parameters. These fluctuations subside the intensive extraction operations. The higher price of oil interrupts the project flow and their investments. Therefore major drilling, evaluation, or extraction-related operations are suspended which has resulted in the downfall of the Oilfield Service Industry.

Environmental hazards:

The extraction of Shale gas is the most prominent segment in the Oilfield Service industry. However, the process leaves a sizeable impact on the environment. The leakage of harmful chemicals and waste during the process of extraction could potentially pollute the water lines. The emission of greenhouse gases and pollution caused during the extraction impose serious, even irreversible impacts on the Environment. This has propelled governments of several countries like the UK to prohibit the extraction of shale gas. The Council of Scientific Society Presidents formally established the environmental costs incurred in the Shale gas extraction.

Market Challenges:

Rising environmental impacts:

Newyork has recently discovered the health issues and concerns that arise due to Hydraulic fracturing. Air and water contamination, rising number of earthquakes are some of the major environmental hazards experience due to Hydraulic fracturing. A recent study states that Ohio has experienced about 77 minor earthquakes in a month due to hydraulic fracturing. Such studies have imposed stringent regulations and a ban over the Hydraulic method of extraction which is considered as the major challenge of the Oilfield Services Market growth.

Increasing fatalities:

Although the countries have adopted stringent laws and regulations which burden the oil and gas industries in their region, the fatality rate is continued to increase in recent years. Oil and gas extraction work-related fatalities have significantly increased over 27.6% with 1189 deaths in the US. In 2010, the oil spill has caused 11 deaths, and an estimated over 25,000 marine mammals were affected by the incident. Such factors have stimulated the governments to revise the regulations to prevent such incidents. This prospect has restricted the Oilfield Service market growth.

Cumulative Growth Analysis:

The Oilfield service industry is currently facing slow-paced growth across the globe owing to the fluctuations in the prices of oil and gas. However, several factors fuel the Oilfield Services Market growth. Recent analysis and insights report the presence of favorable prospects that promotes the Oilfield Services Market Value. Among other natural gases and oils, the Extraction of shale gas is holding the largest market as it can't flow back into the well. Additionally, their low permeable nature, varied applications have propelled the segment growth in recent years. The Oilfield services include operations such as exploration, drilling, completion, and maintenance of the well. Growing technologies enable operations with higher energy efficiency, precision while reducing the formation damage, labor costs, and borehole erosion.

The Oilfield Service market is expected to experience stagnant growth registering a CAGR of about 6.5%, and estimated to reach USD 377 billion by 2026, presently the market is valued at 258 billion. Growing urbanization, industrialization, and commercial activities across the globe have stimulated the demand for power and electricity, the rising demand for energy combined with the increasing investments in oilfield sectors are some of the major factors that aid the Oilfield Services Market growth.

Value chain analysis:

The production and discovery of Shale gas since 1981 have increased the Oilfield Service Market value. Shale gases exist in the form of shale and are widely utilized for power generation. Their abundant availability and lower permeability have increased their popularity among Oilfield operators. Hydraulic fracturing and similar procedures are carried out to obtain these trapped gases. India is expected to cross over USD 2.84 billion by 2027 which is anticipated due to the evolving technologies utilized in the oilfields. There has been increasing support to the Indian oil and gas industry like increased foreign investments and advanced technologies like robotic oil rigs and automated technology is expected to enable the Oilfield Service Market growth.

A recent study reports that Oil production activities are expected to increase in the forecast period at a faster pace. Owing to the discoveries of new oilfields, about 83 million barrels of oil production is expected in a day by the year 2022 and a 30% increase is expected in the crude oil segment. Such reports have propelled the operators and manufacturers to invest in the market.

Segment overview:

Based on application:

  • Onshore

  • Offshore

Based on service:

  • Workover & completion services

  • Production

  • Drilling services

  • Subsea services

  • Seismic services

  • Processing & separation service

Based on type:

  • Equipment rental

  • Field operation

  • Analytical & consulting services

Regional analysis:

Developed Countries like China, Indonesia, Malaysia, Myanmar, and Thailand have experienced a fast-paced increase in production & exploration activities owing to discoveries of oil & gas reserves. Owing to advanced technologies like seismic mapping which is a mapping technology that has promoted the exploration efforts more productive in those regions.

European Union has imposed a stringent law concerning environmental and safety measures. In the year 2013, they have revised their Offshore regulatory routine. Any operator before commencing the drilling operation must submit the report on the list of environmental hazards that the operations could lead to. Additionally, they must provide the company's response plans with the list of equipment and resources available. Such factors have stimulated the Oilfield Service market growth in the region.

Report Overview:

This report has covered:

  • Market overview

  • COVID 19 Analysis

  • Market dynamics

  • Cumulative growth analysis

  • Value chain analysis

  • Segment overview

  • Regional analysis

  • Competitive landscape

  • Recent developments

Segmentation Table:

Based on application:

  • Onshore

  • Offshore

Based on service:

  • Workover & completion services

  • Production

  • Drilling services

  • Subsea services

  • Seismic services

  • Processing & separation service

Based on type:

  • Equipment rental

  • Field operation

  • Analytical & consulting services

Report Scope:
Report Attribute/Metric Details
  Market Size

  • 2028: USD 359.57 Billion
  • 2030 : Significant value
  • 2030 : Significant value
  •   CAGR   6.45% CAGR (2022-2030)
      Base Year   2021
      Forecast Period   2022-2030
      Historical Data   2019 & 2020
      Forecast Units   Value (USD Million)
      Report Coverage   Revenue Forecast, Competitive Landscape, Growth Factors, and Trends
      Segments Covered   Service, Application
      Geographies Covered   North America, Europe, Asia-Pacific, and Rest of the World (RoW)
      Key Vendors   Schlumberger Limited (US), General Electric (US), Halliburton (US), Weatherford (France), National Oilwell Varco (US), Asian Oilfield Services Limited (India), TechnipFMC plc (UK), Bronco Oilfield Services Inc (US), and Liberty Oilfield Service (US)
      Key Market Opportunities   Growing Shale Production
      Key Market Drivers   Growth of the global oil field services

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    Frequently Asked Questions (FAQ) :

    • Horizontal drilling • Multilateral drilling • Extended reach drilling • Automated drilling

    This technology allows the operators to reach the deposits that are unreachable by the drilling rigs. It could reach the surface areas where the vertical rigs can't reach.

    • Drilling equipment • Pressure and flow control equipment • Fishing equipment

    Fluctuation in the oil prices, decreased drilling activities are the major restraints of the Oilfield service industry.