Report Summary

The global oilfield chemicals market size is anticipated to grow at a CAGR of 5.0% from 2018 to 2026; however, the industry’s trajectory of growth during the next eight years is expected to be uneven. A pronounced decrease in demand for these products during 2014 -16 is anticipated to be followed by a steep recovery over the later stage of the forecast period. This slump and rebound in oilfield chemicals demand is primarily owing to the volatility in crude prices. Post hitting all time high during 2013 -14, the prices slumped down tremendously within a significant short period to approximately $30/barrel. This resulted in dramatic decline of drilling operations all throughout the globe dripping almost as below as 850 rigs worldwide (all time low) which eventually impacted the oilfield chemicals market as well. However, since later half of 2016, the oil prices have been increasing moderately and hence the drilling activities are also projected to multiple within the next few years. Drilling of unconventional shale reserves is yet another factor driving demand for these products and helping in slowly recovering the lost market share during this low crude price era.

However, in the short term, oilfield chemicals market is anticipated to experience moderate growth in terms of market value before rallying on the later by the end of forecast period. In spite of relatively low demand for these products in the present scenario, the entire level of activities of oilfields and consequently demand for these products is projected to recover at a faster pace starting by the end of 2020. Number of well completion counts is anticipated to increase during the forecast period that will boost demand for completion chemicals in the oilfield chemicals market. Simulation techniques including acidizing and hydraulic fracturing will increase as well fracturing have been increasing or else subject to other methods of simulation ahead of initial completion. Even though few of the segments of the upstream sector are inexorably volatile, others are relatively stable. With the slow increase in oil price demand of the oilfield chemicals market will take up pace over the forecast period.

Segment Analysis

The global oilfield chemicals market is segmented into product types, application sectors and region. The product categories are further segmented into drilling fluids, simulation fluids, completion & work over fluids and cement slurries. The application segment is further subdivided into production chemicals, simulation fluid additives, drilling fluid additives, cement additives, EOR products, completion & work over fluid additives. EOR products or chemicals are expected to be the fastest growing application area. With increasing demand for oil, depleting conventional reserves have forced industry players to opt for enhanced recovery processes. Drilling of unconventional reserves such as tight gas & oil reserves, shale reserves etc. have increased with the pressure of the fact saying hard to find oil conventionally and also for sustainable development of the environment and its future.

These are some of the major factors driving EOR practices globally and also with it demand for chemicals used for these operations are eventually increasing. With the prices slowly returning to the upper side EOR operations are expected to remain attractive options. Completion and work over fluids will also compete potentially in terms of volume demand over the forecast period. This in-turn would push the oilfield chemicals market globally.

Regional Segments

North America was the leading region in the oilfield chemicals market in 2017. Demand for oilfield simulation chemicals in the U.S. in 2017 accounted for approximately 34% of the overall market, drilling fluids 36% approx., production chemicals for over 10%, cementing types for around 6% and the other types for 11% approximately the same year. The country’s upstream industry is anticipated to experience healthy growth the next few years overcoming the price declines. The increase in unconventional drilling in the U.S. is the primary development in the global oil industry, successful of altering balance of demand and supply at the global scale and eventually contributing to the collapse and control over oil prices in the recent past. Simultaneously, increase in drilling operations in unconventional hydrocarbon reserves have be the primary reason dramatically changing the oilfield chemicals market, as higher complexity level and increased costs that are associated with each well drilled have eventually led to rapid growth in demand for these products in the region.

Competitive Analysis

Some of the leading industry participants currently operating in the oilfield chemicals market include Clariant, Solvay, NALCO, Croda International Plc, Baker Hughes, Kemira, Halliburton, Schlumberger Limited, Stepan Company, Akzo Nobel N.V., The Lubrizol Corporation, BASF SE and Dow Chemical Company.