ID: MRFR/E&P/0500-HCR | February 2021 | Region: Global | 120 pages
It is estimated that within the forecast from 2020-2028, the upstream services market growth will reach a CAGR of 9 %. The upstream services are also known as the Exploration and Production sectors that encompass activities like mining, recovering, and production of crude oil and gas. The market is operated through private and public holdings that majorly rely on oilfield services.
Firms that operate only in the upstream sector are commonly referred to as "Independents". However, companies that conduct operations in all sectors are commonly known as IOCs or Integrated Oil Companies. In recent years, the demand for oil and gas has increased rapidly. However, the reserves are declining due to high consumption.
COVID – 19 has severely impacted the upstream service market growth. The operations require team collaboration and integration of equipment with some manual tasks. However, due to the pandemic, social distancing norms are being followed which has impacted the operations. Since the tasks are majorly on fields, hence work could not be progressed within the lockdown impositions.
Also, there has been a decline in oil and gas demand due to impositions of national and lockdowns. Since the majority of the population is working from remote areas, consumption has declined. Besides, due to high price volatility, there have been fluctuations in demand patterns from various countries. The impacts of a pandemic on upstream services market growth are estimated to be for the short and medium-term.
Drivers- Over the past few years, there has been an increase in shale gas extraction which is expected to drive the upstream services market growth. Shale gas is often formed in shale formations which does not flow into the wells as it has low permeability. Technological advancements such as directional drilling have enabled the improvement of shale gas production.
Besides, the production and exploration activities will be increasing in the upcoming years due to an increase in demand for energy and high investments opportunities. These factors will drive upstream services market growth.
Opportunities- There has been increasing demand for energy and natural resources. Thus, there is a requirement for drilling huge amounts of oil and gas. The upstream service industry requires an increase in technological advancements, higher exploration activities, and reduction of production costs. The Upstream Services industry must invest in technology for reducing time, costs, and environmental damage.
Restraints- Paris Agreement of 2016 concluded upstream oil and gas segments will not receive monetary help from the World Bank. Thus, environmental concerns are estimated to impact the industry in the long run. Since upstream is highly regulated and influenced by politics globally. This has become a major restraint for upstream services market growth in the long run.
Challenges- Reduced investment from international and national agencies will pose a challenge for the companies in the upstream services industry. Also, price fluctuations for oil and gaswill couple challenges for high volume sales. High price volatility impacts the demand and supply for crude oil. The disruptions in the demand and supply impact upcoming projects thus resulting in downfall for upstream services market growth.
The investments for oil and gas activities shall impact upstream services market growth in the upcoming years. The drilling technology includes conventional and unconventional types. Thus, shale oil production has increased in popularity for horizontal drilling. Also, unconventional drilling which includes horizontal is becoming cost-effective over the years. In the year 2016, horizontal wells contributed to more than 69 % of crude oil and natural gas within the United States.
The upstream services industry is highly regulated under global environmental laws. Several issues for the environment were taken up in the 2016 Paris Agreement. The companies are required for developing new technologies to reduce environmental damage for meeting the compliance made by national and international agencies.
The market is highly conglomerated and is subdivided into type, service, and application
By type – The market segmentation on type includes further subdivisions like rental equipment, field operations, and analytical services. In this view, the equipment hired for rent holds the largest market share. However, the demand has been increasing, due to which its market growth will be much slower. The field operation segment has been increasing its market share due to the deployment of services.
Additionally, analytical services will grow at a higher rate due to developments like real-time analytics, software solutions, quality control, and others.
By service- The market segments for the services sector can be subdivided into geophysical, drilling, production, processing, and separation. The production sector holds the highest market share followed by drilling services. Other segments are expected to grow at a significant rate due to an increase in exploration activities.
By Application- The market segments are subdivided into onshore and offshore. It is estimated that offshore segments will capture the highest growth due to their increasing investments in subsea and gaseous assets
The upstream service market share is highly competitive with many key players.
North America is anticipated to hold significant market shares. Followed by North America, Asia- Pacific and Europe will be capture high market growth during the forecast period. Owing to increasing activities in offshore activities. In Europe, operating cost for excavating oil well has been reduced by 30 % in Norway due to which upstream services market growth is expected. In addition to this, the Middle East and Africa have high growth potentials due to untapped capacities for hydrocarbons and non-complex formations.
In the year 2020, DOF subsea announced contractual agreements with Petrobras that are worth 110 million. Solstad Offshore ASA has obtained many contracts for upstream services in Brazil. Also, Subsea 07 agreed to a contract to manage, engineer, and install offshore activities in Trinidad and Tobago.
The report has included analysis on market overview, pandemic analysis, market dynamics, value chain analysis, segment overview, competitive landscape, regional analysis, and recent development.
|Market Size||2023:USD 124.1 Billion|
|Forecast Units||Value (USD Billion)|
|Report Coverage||Revenue Forecast, Competitive Landscape, Growth Factors, and Trends|
|Segments Covered||Type and Well Type|
|Geographies Covered||North America, Europe, Asia-Pacific, and Rest of the World (RoW)|
|Key Vendors||Schlumberger Limited (U.S.), Halliburton (U.S.), Baker Hughes Incorporated (U.S.), Petrofac Limited (Jersey), Weatherford (U.S.), TECHNIP (U.K), China Oilfield Services Limited (China), Transocean Ltd. (Switzerland), Flour Corporation (U.S.), and Saipem S.p.A. (Italy), GE Oil & Gas (U.S.) and they are highly capable to give the finest service in the industry.|
|Key Market Opportunities||Increase in demand of energy and natural resources in various nations|
|Key Market Drivers||
Frequently Asked Questions (FAQ) :
It is projected that the Upstream Services Industry will grow at a CAGR of 9% during the forecast period 2021-2028.
It is estimated that the market value of the Upstream Services Industry will reach up to USD 154 Billion during the forecast period 2021-2028.
The Upstream Services Industry will grow at a rapid speed during the forecast period. The major driver is the rising need to elevate the activities in the production line with advanced technology. The new technology will help to save time and the use of unconventional resources will escalate the market. Along with that, the availability of skilled labours will further promote the market growth to a huge extent.
Some of the major restraints that will hinder the market growth are the unstable price of crude oil. If the price of crude oil soars up high, then it can delay the planned projects. Also, the huge competition between non-OPEC and OPEC Countries will further hamper the market growth with unstable prices. As a result, this can lead to a major restraining factor.
It is estimated that North America will dominate the Upstream Services Market in the upcoming years. It is because, countries like Canada and the US will offer huge potential with exploration of natural gas, shale sands, tight gas, etc. Apart from that, the Middle East region has recorded an exponential growth in the past few years. Also, the Asia-Pacific region is also estimated to have a rapid growth. It is because of the several new discoveries and rising demand of petrochemicals in developing countries like China, India, etc.
These are the major key players of the Upstream Services Industry- Flour Corporation (US), GE Oil and Gas (US), China Oilfield Services Limited (China), Petrofac Limited (Jersey) Bajer Hughes Incorporated (US), TECHNIP (UK), Halliburton |(US), Transocean Ltd. (Switzerland), Weatherford (US), Saipem S.P.A. (Italy), Schlumberger Limited (US), Abu Dhabi Oilfield Services (USE), Petroleum Dynamics Oil and Gas (East Ahmadi, Kuwait), BJ Services (Texas), Advanced Energy System (Egypt), Larsenand Toubro (India), Oman Oil Industry Supplies and Services Co. LLC (Oman), among others.
The Upstream Services Market is segmented into Type, and Well Type. The well type segment is divided into Off Shore and On Shore. Then, the Type segment is divided into Completion Convention, Pressure Pumping, Waste Management, Well Fluids, Tubular Goods, Wireline, Coiled Tubing Intervention and others.
It is anticipated that the On Shore Segment will dominate the Upstream Services Industry during the forecast period.