GLOBAL OILFIELD SERVICES MARKET SIZE AND SHARE ANALYSIS - GROWTH TRENDS AND FORECASTS (2024 - 2031)

Market Size and Trends

Global oilfield services market is estimated to be valued at USD 134.0 Bn in 2024 and is expected to reach USD 168.77 Bn by 2031, exhibiting a compound annual growth rate (CAGR) of 3.3% from 2024 to 2031.

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The market is expected to witness steady growth during the forecast period. Growing oil & gas exploration and production activities mainly driven by rising energy demand globally will drive the global oilfield services market growth. Significant investments made by regional governments and energy companies in enhancing oil and gas infrastructure also acts as a key growth driver. Further, development of unconventional reserves and increasing complexity of oilfields requires more technologically advanced oilfield services which presents new opportunities for service providers. However, volatility in crude oil prices remains a major challenge. But continued shift towards renewable and low carbon alternatives for energy generation can hamper demand for oilfield services over the long term.

Oilfield services demand driven by international exploration projects

The demand for oilfield services is driven by rising international exploration projects. For instance, in May 2022, Equinor had contracts with three oilfield services giants - Baker Hughes Norge, Halliburton, and Schlumberger for integrated drilling and well services on the Norwegian continental shelf (NCS). The contract is for two years, starting from 1st June 2022. The total value of the contract is about USD 1.8 billion. Many major oil producing countries around the world are investing heavily in offshore as well as onshore exploration activities to discover new oil reserves and maintain their production levels. Several developments are underway in regions such as Middle East, Africa and Latin America to boost exploration of conventional and unconventional reserves. Several national oil companies and international super major operators have substantial exploration budgets planned over the next 5 years for high potential areas. For instance, Saudi Aramco had committed multi-billion dollar exploration programs offshore as well as onshore Saudi Arabia and neighboring regions to find sizable discoveries. Abu Dhabi National Oil Company has exploration and appraisal drilling planned across Latin America and Africa in joint ventures with international players. Major international operators like ExxonMobil, Chevron and BP also have vast exploration portfolios globally relying on oilfield services for activities.

Market Concentration and Competitive Landscape

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The demand for oilfield services is driven by growing production from mature oil and gas assets globally. As many of the existing oil and gas fields around the world reach maturity, oil and gas companies are deploying advanced production technologies such as enhanced oil recovery techniques to prolong the life of these mature assets and maximize production from them. This relies heavily on specialized oilfield services which are crucial for conducting complex intervention operations in mature fields and improving their recovery rates. For instance, the mature oil fields of the North Sea region and the shallow water Gulf of Mexico are adopting digital transformation solutions, remote operations, precision drilling and smart well completions to boost productivity, according to the International Energy Agency (IEA). The need for well intervention services, reservoir management technologies, drilling optimization solutions along with expertise in stimulation activities has grown exponentially over the past few years to extract remaining reserves from reservoirs considered mature. Reservoir management services have seen huge demand as production from existing reservoirs accounts for over 65% of global supply as per the IEA. This demand is expected to rise further as depletion rates inmaturing conventional oil fields accelerate globally.

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Global oilfield services market faces several challenges. Global oil prices have declined significantly in recent years due to increased supply and weaker demand, pressuring revenue for services companies. Geopolitical uncertainties in oil producing regions also introduce risk. Renewable energy sources are gaining favor which could reduce reliance on fossil fuels long-term. Service providers must navigate less spending by oil producers seeking to cut costs. Finding skilled labor is a challenge as well, as veterans in the industry reach retirement age.

Market Opportunities: Unlocking Resources from More Complex Reservoirs

Major producers focus on unlocking resources from more complex reservoirs, demand remains for specialized equipment and expertise. Technologies enabling horizontal drilling and hydraulic fracturing continue evolving to maximize resource recovery. Offshore and unconventional plays require extensive services for development. Ongoing pipeline and infrastructure work also supports services activity. Future investments in enhanced oil recovery using techniques like carbon capture could further benefit service. 

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In terms of application, offshore segment is estimated to contribute 67.0% market share in 2024, owing to various factors. Offshore oil reserves tend to be larger than onshore reserves for many oil producing countries. As onshore resources are increasingly depleted, oil companies are drilling in deeper waters to extract oil and gas reserves. This has increased demand for specialized offshore exploration and production services. Many governments provide incentives and tax benefits to encourage oilfield service companies to invest in offshore operations. For instance, the Deep-Water Royalty Relief Act of 1995 in the U.S. helped revitalize deep-water exploration in the Gulf of Mexico despite low oil prices at the time Stringent safety and environmental regulations in offshore operations further promote adoption of advanced technologies. This creates opportunities for oilfield service providers to supply specialized equipment and digital solutions.

Insights, By Service: Well completion drives growth in Well Completion Equipment & Services

In terms of service, well completion equipment & services segment is estimated to contribute 46% market share owing to rising well complexity. With conventional reservoirs depleting, oil and gas operators are increasingly tapping into unconventional resources like tight oil and shale gas which are characterized by low permeability. Extracting from such reservoirs requires hydraulic fracturing and higher-intensity well completions.  Therefore, demand has grown for technologically advanced well completion equipment like multi-stage hydraulic fracturing units, sand slurry pumps, coiled tubing units and wired pipe. Completion equipment rental is also gaining popularity over outright purchases given high initial investments required. Digital solutions that leverage data analytics are playing a greater role to optimize well performance monitoring as well.

Insights, By Type: Equipment rental drives growth in Field Operations services

In terms of type equipment rental is estimated to contribute 39% share due to advantages it offers over outright purchases. Field operations demand specialized rigs, drilling tools, pressure pumping units, coiled tubing equipment and more on a project-to-project basis. However, their utilization rates tend to be low outside actual well construction periods. Capital expenditures on such expensive field machineries also burden service company balance sheets. Consequently, equipment rental has emerged as an attractive alternative where oilfield service companies can optimize asset productivity and reduce clients' upfront costs. Rental contracts assure service providers of recurring revenues. They can economically maintain large rental fleets to meet temporary or seasonal demands across regions. Furthermore, rental companies leverage advanced telematics and analytics to track asset utilization, schedule maintenance efficiently and ensure service quality.

Regional Insights

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North America has remained the dominant regional market for oilfield services over the past decade with 42.3% share. The region is home to major oilfield services companies with strong brand recognition globally. Companies based in the U.S. and Canada have established infrastructure and expertise to efficiently deliver the complete range of oilfield services across the world. However, factors like declining production from mature oilfields and increased shale oil production are impacting spending patterns in the region.

The Middle East has emerged as the fastest growing regional market for oilfield services in recent years. National oil companies in the Gulf nations have taken initiatives to increase hydrocarbon production from both onshore and offshore fields through tie-ups with global oilfield service providers. Countries like Saudi Arabia, United Arab Emirates and Qatar are ramping up investments to develop new fields and maximize output from existing oil and gas assets. This boosts demand for services across the exploration, drilling, production and pipeline construction segments. Furthermore, the region offers lucrative pricing for oilfield services work due to high crude oil prices and subsidies provided by governments. Major players have established local manufacturing and operational facilities to capitalize on lucrative long-term contracts from national oil companies. Providers of specialized services required in offshore and complex oilfield developments have also increased their presence in the Middle East. The regional market provides opportunities to deliver integrated solutions and achieve economies of scale due to large production projects involving multiple oilfields.

Market Report Scope

Key Developments

• In March 2023 Peak Petroleum Industries Ltd awarded a contract for the Blackford Dolphin semi-submersible drilling rig to Dolphin Drilling for drilling in offshore Nigeria. The rig will continue its operations after the current 12-month agreement with General Hydrocarbons Ltd. (GHL).
• In October 2022, Weatherford International Plc. entered into an agreement with Saudi Aramco to deliver drilling and intervention services for their oil and gas operations. Under this contract, Weatherford is responsible for providing comprehensive solutions covering all aspects of planning and execution, utilizing its diverse range of products and related services.
• In 2020, DOF Subsea announced the acquisition of several contracts from Petrobras, notably a substantial agreement valued at USD 110 million. This particular contract pertains to the inspection of flexible pipelines, risers, and subsea equipment across multiple The scope of work involves the utilization of vessels from the DOF fleet to carry out inspections in the Campos, Santos, and Espírito Santos basins, along with the Marlin field.
• In August 2020, Solstad Offshore ASA was granted contract extensions in Brazil by Equinor and Total. Equinor Brazil extended the contracts for the Sea Brasil and Far Scotsman platform supply vessels (PSV) by one year until December 2021 and by six months until May 2022, respectively
• In September 2020, Subsea 7 successfully secured a contract for offshore operations in Trinidad and Tobago. This contract encompasses project management, engineering, procurement, installation, and pull-in of a subsea rigid flowline, flexible riser, flexible flowlines, as well as the associated subsea infrastructure and umbilical system. The installation activities are planned to be carried out by 2021.

*Definition: The oilfield services market consists of companies that provide various services to oil and gas exploration and production companies. These services help in facilitating oil and gas extraction from reservoirs underground. Some key services include drilling, pressure pumping, oilfield and well completion services, coiled tubing services, well intervention, wireline services, oilfield equipment rental services, fishing tools, solids control, fluid management, and artificial lift services

Market Segmentation

• Application Insights (Revenue, USD Bn, 2019 - 2031)
  • Onshore
  • Offshore
•  Service Insights (Revenue, USD Bn, 2019 - 2031)
  • Pressure Pumping Services
  • Oil Country Tubular Goods
  • Wireline Services
  • Well Completion Equipment & Services
  • Well Intervention Services
  • Others (Drilling & Completion Fluid Services, etc.)
•  Type Insights (Revenue, USD Bn, 2019 - 2031)
  • Equipment rental
  • Field Operation
  • Analytical services
• Regional Insights (Revenue, USD Bn, 2019 - 2031)
  • North America
    • U.S.
    • Canada
  • Latin America
    • Brazil
    • Argentina
    • Mexico
    • Rest of Latin America
  • Europe
    • Germany
    • U.K.
    • Spain
    • France
    • Italy
    • Russia
    • Rest of Europe
  • Asia Pacific
    • China
    • India
    • Japan
    • Australia
    • South Korea
    • ASEAN
    • Rest of Asia Pacific
  • Middle East & Africa
    • GCC Countries
    • Israel
    • Rest of Middle East & Africa
• Key Players Insights
  • Middle East Oilfield Services LLC
  • RAAS Oilfield Services & Supplies WLL
  • FOS Energy LLC
  • Oman Oil Industry Supplies & Services Co. LLC
  • CAM Integrated Solutions
  • GE
  • Oil States Industries
  • Nine Energy Service
  • C&J Energy Services
  • Rockwell Automation
  • Churchill Drilling Tools- Coretrax
  • SPX FLOW, Inc.
  • FMC Technologies
  • Ensco plc
  • Petrofac
  • Transocean
  • Saipem
  • SGS
  • Schneider Electric
  • ABB