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Oilfield Production Chemicals Market Size Forecast to Reach US$3.6 Billion by 2027

Oilfield Production Chemicals Market Size Forecast to Reach US$3.6 Billion by 2027

May 04
11:33 2022
Oilfield Production Chemicals Market Size Forecast to Reach US$3.6 Billion by 2027
Oilfield Production Chemicals Market | IndustryARC
The Growing Use for Advanced Drilling Fluid in the Extraction of Oil Will Be Driving the Oilfield Production Chemicals Market During the Forecast Period.

Oilfield production chemicals market size is forecast to reach US$3.6 billion by 2027, after growing at a CAGR of 4.1% during 2022-2027. Oilfield production chemicals like scale inhibitors, demulsifiers, and others are widely used as a drilling fluid to prevent from blocking the flow of liquid through valves, pipelines, and pumps during the processing and production of oil. Oilfield production chemicals are also used for the transportation of crude oil. According to OECD, the total production of crude oil in 2020 is around 93.90 million barrels per day, 95.53 million barrels per day in 2021, and is estimated around 101.05 million barrels per day in 2022 and 102.84 million barrels per day in 2023. Therefore, the growing production of crude oil will boost the oilfield production chemicals market during the forecast period.

COVID-19 Impact

The Covid-19 pandemic has been a major challenge for the oilfield production chemicals market owing to directly affecting the manufacturer’s supply chain across the globe and shutting down the production facilities to minimize the risk of virus spread. The oil & gas sector has been highly impacted due to disruption in logistics and supply chain. The production of crude oil has been stopped and also prices of crude oil fluctuated owing to international trade being banned during the pandemic. According to U.S. Energy Information Administration (EIA), as of January 11, 2022, global oil inventories have fallen for six consecutive quarters, declining at an average rate of 2.1 million barrels per day in the second half of 2020 and an average rate of 1.4 million barrels per day in 2021. This resulted in the decline of the overall oil & gas sector and highly impacted the growth of the oilfield production chemicals market. However, for the forecast period, the market is expected to grow owing to gradually increased demand from end-use industries, which is anticipated to impact the oilfield production chemicals market positively.

Oilfield Production Chemicals Market Segment Analysis – By Type

The demulsifiers segment accounted for around 18% of the market share in 2021 and is estimated to grow at a significant CAGR during the forecast period. Demulsifiers type oilfield production chemical is widely used in the separation of oil emulsion & water during oil production, especially at offshore sites. The demulsifier is also used in onshore oilfield production activities for the separation of oil and water owing to the increased exploration of new oil reservoirs. Equinor along with partners PGNiG Upstream Norway and Longboat Energy Norway has found oil in exploration well 6407 / 1-9 in Egyptian Vulture in November 2021. Therefore, the increase in new reserves will help to increase demand for the use of demulsifiers in oilfield Production and turn will boost demand for oilfield production chemicals during the forecast period.

Oilfield Production Chemicals Market Segment Analysis – By Application

The oil-water separator segments held a significant share in 2021 and are estimated to grow at a significant CAGR during the forecast period owing to the extraction of oil activity for separating water by using oilfield production chemicals. The oil-water separator plays a significant role in driving the demand for oilfield production chemicals as it is one of the major processes for extracting crude oil by separating water from reserves. According to the U.S. Energy Information Administration (EIA), global oil inventories will increase by 0.5 million barrels per day in 2022 and by 0.6 million barrels per day in 2023. Global oil consumption has been increased by 5.5% in 2021 from 2020. Therefore, the increase in oil inventories and consumption of crude oil will boost the demand for oil water separator segments which in turn drive the oilfield production chemicals market during the forecast period.

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Oilfield Production Chemicals Market Segment Analysis – By Geography

The Middle East region held a significant share in the oilfield production chemicals market in 2021 and estimated to grow at a CAGR of 3.8% during the forecast period. The presence of oil reserves in countries like the United Arab Eminent, Saudi Arabia, Iraq, Iran, Kuwait, and others is driving the regional growth during the forecast period. According to U.S. Energy Information Administration (EIA), Saudi Arabia holds 15% of the world’s proven oil reserves and maintains the world’s largest crude oil production capacity at nearly 12 million barrels per day. The UAE holds the seventh-largest proved oil reserves in the world at 98 billion barrels. According to OPEC, the export of crude oil to European countries by Nigeria is around 6.6% and Libya with 6.5%. Therefore, the use of oilfield production chemicals in extracting and transporting of crude oil is boosting the demand for the oilfield production chemicals market during the forecast period.

Oilfield Production Chemicals Market Drivers

The growing demand for advanced drilling fluids

The growing demand for advanced drilling fluids during the extraction of oil is driving the oilfield production chemicals market. The specialty polymers and surfactants are widely used for high-performance drilling fluids. These high-performance drilling fluids are designed to provide a solution for water and oil-based drilling fluids with satisfactory rheology, suspension, fluids loss control, hole cleaning, and other essential functions like rheology modifiers, biocides, emulsifiers, lubricants, corrosion inhibitors, and others. According to U.S. Energy Information Administration (EIA), the total production of crude oil in 2021 is around 11,800 thousand barrels per day in the US, and in Alaska is around 459 thousand barrels per day. Therefore, the growing use for advanced drilling fluid in the extraction of oil will be driving the oilfield production chemicals market during the forecast period.

Increasing oil production and exploration activities

An increase in the production and exploration activities of oil will drive the oilfield production chemicals market during the forecast period. According to Oil & Gas Journal’s annual assessment, the proven oil reserves of the world is around 1.73 trillion barrels per day in 2020, with a 2.6% higher than 2019 owing to dramatic growth in Iran’s oil reserves reported by the Organization of the Petroleum Exporting Countries (OPEC). According to International Energy Agency, the regional share of crude production in 2020 in the Middle East occupied 30.9%.The increased oil production and exploration activities will increase the demand for oilfield production chemicals across the globe which in turn, will boost the demand for oilfield production chemicals during the forecast period.

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Oilfield Production Chemicals Market Challenges

Stringent regulations by the government and the fluctuating rates of prices of crude oilThe regulations for protecting crude oil and other natural resources laid by the government are hindering the oilfield production chemicals market during the forecast period owing to hinder exploration activity across the globe. Also, the fluctuating prices of crude oil in the global market may act as a restrain in the overall growth of the oilfield production chemicals market. According to U.S. Energy Information Administration (EIA), Brent crude oil spot prices increased from an average of US$43 per barrel in the third quarter of 2020 to an average of US$79 per barrel in the fourth quarter of 2021. Brent prices average forecasted to be around US$75 per barrel in 2022 and US$68 per barrel in 2023. Therefore, the stringent regulations by the government and volatile prices of crude oil can hamper the oilfield production chemicals market

Oilfield Production Chemicals Industry Outlook

Technology launches, acquisitions, and R&D activities are key strategies adopted by players in the market. Oilfield Production Chemicals top 10 companies include:

Schlumberger Limited

Clariant AG

Akzo Nobel N.V.

Halliburton Company

BASF SE

Arkema S.A

Huntsman Corporation

Solvay S.A.

Baker Hughes

Dow

Dupont Inc.

Key Takeaways

The Middle East and Africa are expected to register a CAGR of 3.1% during the forecast period (2022-2027). The increasing demand from the oil & gas sector in countries such as Saudi Arabia, Iran Kuwait, and others are driving the oilfield production chemicals market owing to the presence of oil reserves in this region.

The growing demand for petroleum-based fuel from the transportation sector is expected to boost the demand for oilfield production chemicals in the forecast period.

Oilfield production chemicals are widely used in the production processes of crude oil, drilling, cementing, hydraulic fracturing & other production methods owing to these, the oilfield production chemicals market is anticipated to witness positive growth during the forecast period.

Relevant Reports

Oilfield Surfactants Market – Forecast (2022 – 2027)

https://www.industryarc.com/Report/243/oil-field-surfactants-market-analysis.html

For more Chemicals and Materials Market reports, please click here

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