Drilling Fluids Market Size, Share, Opportunities, COVID-19 Impact, And Trends By Fluid Type (Water-Based, Oil-Based, Synthetic-Based, Others), By Application (Onshore, Offshore), And By Geography - Forecasts From 2022 To 2027

Over the projected period, the worldwide drilling fluids market is predicted to increase at a CAGR of 8.44%, reaching a total market value of US$14.751 billion by 2027, up from US$8.368 billion in 2020.

Drilling fluids, also known as drilling mud, play an important role in facilitating the drilling process by suspending cuttings, controlling pressure, stabilizing exposed rock, providing buoyancy, cooling, and lubricating. Every drilling activity requires drilling fluids, and they are used extensively across the globe. Drilling fluids can be oil-based, water-based, and others, and each composition produces a unique solution in the well. These are essential to drilling success, as they maximize recovery and minimize the amount of time taken to achieve the required goal. Drilling deeper, longer, and more difficult wells have been possible due to advancements in drilling technology, including drilling fluids that are more efficient.

Market dynamics

The rising worldwide energy demand due to population increase is the primary driver of the drilling fluids market. Furthermore, as a result of the effective adoption of nanotechnology in the oil and gas business, numerous corporations have made significant investments in drilling fluids. On the brighter side, most of the onshore locations in the global drilling fluids market are currently facing depletion, which has prompted many companies to drill deeper. This requires a much larger amount of drilling fluid to function in an optimum condition, which will create a higher demand for drilling fluids in most regions.

The drilling fluids market, on the other hand, confronts problems as a result of several environmental and socioeconomic risk concerns linked with the drilling sector.

Factors like huge demand for clean and renewable energy globally, a highly volatile crude oil market, strict government laws and regulations, and environmental concerns related to exploration activities may restrain the market’s growth. Furthermore, due to growing environmental concerns on account of the harmful effects of using oil-based fluids, major players are investing heavily in research and development activities, leading to the growing adoption of water-based drilling fluids.  As a result, companies are focusing their efforts on creating innovative nanotechnology-based solutions to address the present technical and environmental concerns, hence opening up a plethora of prospects for the industry.

Oil and gas industry

Drilling in the oilfields is required for the extraction of oil and gas, which uses fluids to make the process of drilling more effective, therefore enhancing the yield of the oil and gas by decreasing wastage. Some additives are also added to the drilling fluids to increase the viscosity, and lower the shear rate when drilling is being performed in high-angle situations or deeper oil wells. In addition, drilling fluids can aid in the collection of cuttings and shavings on the surface, therefore preventing oil pollution. Furthermore, some companies are expanding their operations to meet rising energy demand. For instance, in November 2019, ADNOC Drilling announced that they had expanded their onshore and offshore rigs for accelerating the facilitation of oilfield drilling operations, and similarly, Panoro Energy, announced in February 2020, that they had increased their drilling activities in Tunisia. Thus, these product offerings by the market competitors and the expansion activities being done are also contributing to a spike in the market demand for drilling fluids.

Recent update

• In November 2019, the Ministry of Environment, Forest, and Climate Change (India) granted the ToR for the Cauvery onshore development drilling project (24 wells).
• In November 2019, Abu Dhabi National Oil Company announced a major drilling fleet expansion program to support ADNOC’s upstream growth plans and enable the delivery of its 2030 Smart Growth Strategy.
• In May 2018, Oil and Natural Gas Corp (India) announced plans to spend nearly INR 17,600 crore on drilling a record 535 wells in 2018-19. The government is also supported by providing technological support to reduce the country’s dependence on crude imports.

North America holds a significant share in the market

By geography, the global drilling fluids market is segmented into North America, South America, Europe, the Middle East, Africa, and the Asia Pacific. The North American region is likely to have a major part of the market due to massive deposits of unconventional hydrocarbon reserves, as well as increased gas exploration and drilling activities for oil and gas in the region. Besides, the governments in the region have also formed policies and regulations for the prevention of the degradation of the environment, which increases the range of opportunities for new advanced products. Because of a lack of technology, the Asia Pacific area is predicted to develop at an exponential rate due to an increase in the exploration of oil fields from unexplored deposits. Also, countries like India and China are investing heavily to reduce their dependency on crude imports, showing growth opportunities for drilling fluid manufacturers and vendors in the region.

Key Developments

• In March 2019, Kuwait Oil Firm awarded contracts of US$150 million to Scomi Energy Services Bhd, a management service company. It offers deep drilling mud, development drilling mud, and mud engineering services.
• In February 2021, National Oilwell Varco has released a falcon reamer, which is needed for drilling operations in the Middle East and North Africa. The device is intended to create high-quality wellbores while also being extremely efficient in operation.

Frequently Asked Questions (FAQs)

Q1. What will be the drilling fluids market size by 2027?
A1. The global drilling fluids market is expected to reach a market size of US$14.751 billion by 2027.

Q2. What is the size of the global drilling fluids market?
A2. Drilling Fluids Market was valued at US$8.368 billion in 2020.

Q3. What are the growth prospects for the drilling fluids market?
A3. The drilling fluids market is expected to grow at a CAGR of 8.44% over the forecast period.

Q4. Which region holds the largest share of the global drilling fluids market?
A4. North American region is expected to hold a significant share of the drilling fluids market owing to huge reserves of unconventional hydrocarbon reserves coupled with the growth in gas exploration and increase in drilling activity for oil and gas in the region.

Q5. What factors are anticipated to drive the global drilling fluids market growth?
A5. The rising worldwide energy demand due to population increase is the primary driver of the drilling fluids market.