Oilfield Chemicals Market Set to Grow at Highest Pace owing to Increasing Usage in Enhanced Oil Recovery Techniques
Oilfield Chemicals Market Set to Grow at Highest Pace owing to Increasing Usage in Enhanced Oil Recovery Techniques
Blog Article
Oilfield chemicals play an important role in enhancing oil and gas recovery from reserves. Chemicals such as biocides, corrosion inhibitors, demulsifiers, scale inhibitors, and lubricants are widely used across various stages of oil and gas operations including extraction, production, transportation, and processing. Biocides help eliminate bacteria that can clog pipelines or accelerate corrosion while corrosion inhibitors protect infrastructure from corrosion. Demulsifiers separate water emulsions from crude oil during production. Scale inhibitors prevent formation of scales inside production equipment. Lubricants aid reducing friction between moving parts.
The oilfield chemicals market is estimated to be valued at USD 29.37 Bn in 2024 and is expected to reach USD 36.86 Bn by 2031, exhibiting a compound annual growth rate (CAGR) of 3.3% from 2024 to 2031.
Key Takeaways
Major Players In Oilfield Chemicals Market are Baker Hughes, Halliburton Energy Services, Solvay SA, Lubrizol Corporation, and AkzoNobel N.V.
Increasing oil and gas exploration and production activities are fueling the demand for oilfield chemicals globally. Chemicals play a vital role in drilling fluids, fracturing fluids, cementing, steam injection, and production chemicals. Also, rising investments in enhanced oil recovery techniques bode well for the Oilfield Chemicals Market Share
Technological advancements are helping introduce bio-based and environment-friendly oilfield chemicals. Advances in nanotechnology are aiding development of smarter chemicals that can better withstand high pressures and temperatures underground. Real-time monitoring of oilfield chemicals through Internet of Things is also gaining traction.
Market Trends
Rising investment in unconventional oil and gas extraction: Major oil companies are investing heavily in extracting oil and gas from unconventional reserves such as shale, tight gas, and oil sands which requires extensive use of chemicals during drilling, completion and production activities. This is expected to drive the demand for oilfield chemicals.
Growing need for enhanced oil recovery (EOR): With depletion of onshore reserves, EOR techniques such as polymer flooding, surfactant-polymer flooding and alkaline-surfactant polymer flooding are being increasingly used to improve recovery from mature fields. This will boost consumption of oilfield chemicals for EOR over the forecast period.
Market Opportunities
Increasing exploration and production (E&P) activity in deepwater and ultra-deepwater reservoirs: Significant E&P push in offshore deepwater and ultra-deepwater fields requires specialized offshore oilfield chemicals to overcome various drilling and production challenges like extreme pressure and temperature. This presents opportunities for suppliers.
Rising shale gas production worldwide: More countries are shifting focus towards developing shale gas reserves. This growing trend will create lucrative opportunities for providers of oilfield chemicals optimized for unconventional gas extraction.
Impact of COVID-19 on the Oilfield Chemicals Market
The global oilfield chemicals market has been significantly impacted by the COVID-19 pandemic. During the initial months of the pandemic in 2020, lockdowns and mobility restrictions across various countries led to a steep decline in oil demand and prices. This caused oil producers to cut production sharply, thereby reducing the need for oilfield chemicals. Many onshore and offshore oil and gas projects were postponed or temporarily suspended during this period due to disruptions in supply chains and workforce availability.
However, with gradual relaxation of lockdowns and resumption of economic activities in 2021, crude oil demand and prices recovered significantly. This encouraged oil producers to ramp up production levels and restart stalled projects. This boosted demand for oilfield chemicals which help in increasing production efficiency, enhancing recovery from mature fields and reducing environmental impacts. The easing of mobility restrictions also allowed resumption of offshore project activities which utilize specialized offshore oilfield chemicals. While demand stabilized post pandemic, supply chain disruptions and raw material price inflation continue to pose challenges for oilfield chemical manufacturers.
Geographical Concentration of the Oilfield Chemicals Market
In terms of value, North America holds the largest Oilfield Chemicals Market Size and Trends currently. This can be attributed to large-scale onshore and offshore upstream activities in the US and copyright. The countries are among the top oil producers globally and have huge established reserves which require constant oilfield chemical applications. Recent development of shale reserves in the US through hydraulic fracturing has further augmented demand. The Middle East is another major revenue generator, driven by the dominance of key producers like Saudi Arabia and growing exploration/production spending. Despite challenges faced in 2020, the regional market is recovering strongly amid higher crude oil output.
Fastest Growing Region of the Oilfield Chemicals Market
Asia Pacific region is expected to experience the fastest growth in the oilfield chemicals market during the forecast period. This can be attributed to increasing exploration activities as countries like China, India aim to reduce dependence on oil imports. Australia is also boosting offshore oil and gas development efforts. Surging domestic demand for crude oil and major pipeline/refinery projects underway will drive chemical consumption. Latin America is another high growth market, supported by the focus on developing pre-salt reserves by Brazil and Mexico augmenting offshore/deepwater E&P activities requiring specialized chemical solutions.
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