Oilfield Service Market Research Report and Outlook by 2028

In 2021, the oilfield service sector was valued at approximately US$ 96,465.86 million, with projections indicating it will reach around US$ 145,963.08 million by 2028. This growth represents a compound annual growth rate (CAGR) of 6.1% from 2021 through 2028.

The anticipated growth in the global economy is expected to significantly boost oil demand, particularly as robust economies tend to consume larger quantities of oil. It is estimated that from 2020 to 2024, oil demand will rise by 1.2 million barrels per day annually. By 2023, it is expected that over half of the global oil demand will originate from India and China. Consequently, leading oil and gas corporations are under increasing pressure to enhance production levels to satisfy the escalating energy requirements. As traditional oil fields approach their peak production, many companies are redirecting their efforts towards tapping into unconventional resources. This shift is likely to positively influence the oilfield service market throughout the forecast period, particularly with the rise of alternative drilling services such as onshore contract drilling.

The global oilfield service market is poised for growth driven by several factors, including a surge in global energy consumption, advancements in oilfield technologies, enhanced productivity from established deposits, and increased investments in deep-water exploration initiatives. Furthermore, the anticipated rise in deep-water exploration and production activities in the Gulf region is expected to further stimulate demand for drilling services during the forecast period.

The oil and gas sector is experiencing remarkable progress in exploration technologies, particularly for deep-water drilling, which enhances the economic feasibility of projects and improves recovery rates. These technological advancements enable oil companies to boost productivity and accelerate output. Modern offshore wells are equipped with a variety of automation technologies, ranging from basic monitoring systems to sophisticated subsurface controls featuring intelligent completions. For instance, Petrobras has initiated a corporate program named GeDIg aimed at exploring, developing, and implementing digital integrated field management across its production assets, with the Carapeba field serving as a pilot site. This field has been outfitted with automated subsurface sensors across its three wells. Oil and gas firms are increasingly looking to adopt advanced analytical technologies and information solutions to modernize their offshore operations and utilize data analytics to enhance efficiency. A notable collaboration between Rockwell Automation and Schlumberger has led to the creation of a production advising system that merges production technology with Schlumberger's software, services, and expertise, assisting upstream operators in boosting production while minimizing risks and costs. Additionally, the recent discovery of four new oil and gas fields by Saudi Arabia's Energy Ministry in December 2020 highlights the growing number of offshore and deep-water discoveries, which is expected to present lucrative opportunities for the oilfield service market in the future.

The growth of the oilfield service market in the Asia-Pacific (APAC) region is fueled by the increasing adoption of advanced drilling technologies and a consistent rise in oil production. China, which contributes over 50% of Asia's oil output, stands as the largest oil producer in the APAC area, with a daily production of 5 million barrels. In 2019, China announced plans to boost its capital investment in oil production by 20%. Furthermore, North America and Europe play significant roles in the global oilfield service market, hosting numerous manufacturers in this sector. Key players in these regions include Archer, Blade Energy Partners Ltd., Ensign Energy Services Inc., Halliburton Energy Services Inc., Nabors Industries Ltd., Schlumberger Limited, STRATA Energy Services, and Weatherford International plc.

The COVID-19 pandemic has adversely affected the global oilfield service market, particularly in the United States, where major companies have had to downsize their workforce due to lockdown measures. Currently, over 27% of onshore drilling rigs are inactive, and more than 23% of frac crews have been sidelined in recent years. The pandemic has also led to a decline in oil and gas demand due to mobility restrictions in various industrialized nations, disrupting production and supply chains. The oil market crisis has further strained the capital market, resulting in mature oil companies postponing or canceling $41 billion in planned capital expenditures. Additionally, the unexpected oil price conflict between Russia and Saudi Arabia has hindered the growth of the oilfield services market. Despite these challenges, flexible business strategies have been adopted to enhance the prospects of the oilfield service market.

The size of the global oilfield service market has been assessed using both primary and secondary research methods. A thorough secondary research approach has been employed, utilizing a combination of internal and external sources to gather qualitative and quantitative data related to the oilfield service market. This methodology has also facilitated an overview and forecast for various market segments. Furthermore, numerous primary interviews have been conducted with industry experts and stakeholders, including VPs, business development managers, oilfield service market intelligence managers, national sales managers, valuation experts, research analysts, and key opinion leaders specializing in the oilfield service sector. This has been instrumental in validating the data and providing deeper analytical insights into the market.