Downhole Equipment Market Trends
Growth Drivers
- Surging Hydrocarbons Exploration and Production- The increase in exploration of hydrocarbon gas liquids with the growing demand for ethane, propane, and natural gas used in every end-use sector is leading in onshore & offshore exploration undertakings across the globe. Moreover, with the rapid development of onshore activities, there is a rise in the demand for downhole equipment for wellbore drilling.
- Increasing Production of Unconventional Gases – Owing to the rising focus on future energy security, the investment in the drilling operations to discover conventional gases such as shale gas and others is growing rapidly. Moreover, the rising need for shale gas processing equipment and the development of a wide variety of downhole tools potentially for their use in unconventional shale gas development is anticipated to propel the market growth.
- Growth in Drilling Activities – The surge in the number of explorations, extractions, and increase in oil companies’ production is all backed by the elevated drilling activities worldwide. Since 2022, the drilling activities by U.S. oil companies grew by 60%. This upsurge is estimated to boost the demand for drilling tools.
Challenges
- Fluctuating Oil Prices - the disruption in demand & supply of oil globally owing to the sudden outbreak of a pandemic, economic recessions, and market inflation in many countries of the world is responsible for volatile crude oil prices. The volatility of the global oil industry is discouraging investment in downhole operations and is hampering the growth of the downhole equipment market.
- Stringent Engineering Regulations
- Concern About Adverse Effects on the Environment
Downhole Equipment Market: Key Insights
In 2019, the world’s total energy supply was 606EJ, wherein the highest share in terms of source was captured by oil, accounting for 30.9%, followed by coal (26.8%), natural gas (23.2%), biofuels and waste (9.4%), nuclear (5.0%), hydro (2.5%), and other (2.2%). Where there was an increase in energy demand in 2018, the year 2019 witnessed slow growth as the energy efficiency improved owing to decline in the demand for cooling and heating. However, in 2020, the electricity demand decreased by 1% due to the outbreak of Coronavirus resulting in government imposed shutdowns in order to limit the spread of the virus, which was further followed by shutdown of numerous business operations impacting their growth. This also resulted in decline of 5.8% in the worldwide CO2 emissions which was recorded to be five times larger than the one recorded during the global financial crisis in 2009. However, in 2021, the demand for oil, gas and coal is estimated to witness growth, which is further projected to create opportunities for market growth. Moreover, rising environment degradation and awareness related to climate change is motivating many key players to employ sustainable energy strategies and invest significantly in environment-friendly power generation technologies with an aim to promote sustainable development among various nations around the world. Such factors are anticipated to promote the growth of the market in upcoming years.
|
Base Year |
2024 |
|
Forecast Year |
2025-2037 |
|
CAGR |
9.9% |
|
Base Year Market Size (2024) |
USD 6.06 billion |
|
Forecast Year Market Size (2037) |
USD 20.87 billion |
|
Regional Scope |
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