Drilling Fluids Market Size, Share & Trends Analysis Report By Product (Oil-based, Water-based), By Application (Onshore, Offshore), By Region (North America, Asia Pacific), And Segment Forecasts, 2023 - 2030

Drilling Fluids Market Size & Trends

The global drilling fluids market size was valued at USD 7.99 billion in 2022 and is anticipated to grow at a compound annual growth rate (CAGR) of 4.4% from 2023 to 2030. The growth is attributed to the rising requirement in the energy industry, which is expected to drive the global oil & gas market growth during the forecast period. Furthermore, an increase in demand for crude oil and gas by various industrial sectors, such as power plants and transportation, has been driving the demand for oil and gas production globally. The rising concernsabout handling solid wastes, spill containment, and collapsing boreholes are expected to bring new opportunities for the drilling oil market over the forecast period.

The industry is also expected to witness a huge leap in product demand due to its usability in the industries where oil & gas play an essential role. The growing offshore industry, mainly in the Persian Gulf, is expected to witness huge growth in the drilling fluid market over the forecast period. However, the market growth is predicted to be hindered by the adverse environmental effect of drilling oil coupled with stringent government regulations. The demand for advanced drilling oil chemicals is anticipated to create immense opportunities due to their extensive utilization in horizontal drilling, like wells.

The crude oil price slump in 2014 & 2015 had a major impact on the oil & gas business, leading to reductions in planned capital expenditure and the implementation of cost-cutting strategies. The oil & gas industry started implementing defensive strategies, which had a direct impact on the oil field service industry. The impact was very quick and deepening due to which many industries linked to oil & gas are facing a severe reduction in cash flow. The government has recently imposed strict restrictions on the use of drilling fluid due to its adverse effects on the environment.

Product Insights

The water-based product segment dominated the market with a revenue share of more than 52% in 2022. This is attributed to their usage to drill over 75% of wells globally. The type of fluid selected in the operation depends on the well’s condition, which comprises formate brine or saturated brine and fresh water. Growing concern regarding toxicity and biodegradation of other drilling fluids is expected to play a vital role in rising product demand over the projected period. Water-based oil is expected to gain significance in the coming years owing to its ease of use and discharge feature in offshore activities. The rising demand for an efficient fluid system in high-pressure and high-temperature wells is anticipated to trigger the demand for water-based oils.

Oil-based product is the second-largest revenue contributor to the product market globally. Oil-based drilling fluid is used in drilling engineering and is the composition of oil and water in continuous and dispersed phases, respectively. Oil-based products are expected to gain significance in the future, owing to their improved lubricity. Due to the increasing demand for lesser corrosion of drilling tools, and higher thermal stability, it is expected to grow significantly during the forecast period. Though oil-based fluid is anticipated to witness significant growth in coming years, its reaction affects the environment, resulting in stringent regulations imposed by the government on its use.

Synthetic-based fluid is anticipated to witness rapid growth due to biodegradability characteristics. Its production consists of base oil, such as esters, poly alpha-olefins, and linear paraffin. Synthetic fluids are expected to gain importance during the forecast period due to their low toxicity, low fluid loss, and low bioaccumulation potential. Increasing concerns about downhole losses, and maintenance cost in deep waters projects has urged oil and gas companies to move towards, a more efficient fluid system, which is less harmful to the environment.

Application Insights

The onshore application segment dominated the market with a revenue share of more than 60% in 2022. This is attributed to the increasing number of oil drilling activities to fulfill growing energy needs. Due to an increase in the number of research activities to develop abandoned oil wells and revived projects in various onshore oilfields, the worldwide volume of oil and gas production is expected to grow dramatically. Growing onshore oil & gas exploration in countries like Saudi Arabia, the U.S., China, and Russia is expected to increase awareness and demand during the forecast period.

The growing global offshore rig count coupled with significant development of existing offshore wells both in deep and ultra-deep waters majorly, in the Gulf of Mexico, North Sea, Persian Gulf, and the South China Sea, is anticipated to drive demand in the forecast period. The increasing number of ongoing projects and implementations in the Middle East and Africa region is expected to provide immense demand opportunities for offshore drilling fluids.

Regional Insights

North America dominated the market with a revenue share of more than 26% in 2022. The growth is attributed tothe increasing oil and gas production with significant oil field development, particularly in the U.S.  Also, massive oil reserves in Canada play a major role in driving the demand in the region. Canada is the fifth-largest producer of crude oil and natural gas. The significant development in Canada’s oil & gas field has been a key influencer in the industry growth in the region.Europe is predicted to witness a rapidgrowth.

This is due to significant drilling fluid requirements in horizontal wells, particularly in Italy, Norway, Denmark, the Netherlands, France, and the UK. Growing demand for crude oil has been influencing E&P businesses in Europe to get involved in extensive drilling activities in onshore and offshore locations.Asia Pacific is expected to witnessconsiderable growth due to the exploration of deep waters and tight oil reserves in the region. Various advanced technological implementations to reduce production costs and enhance efficiency are playing an important role in the growth of the regional market.

Key Companies & Market Share Insights

The market has become highly competitive due to the presence of multinationals and more than 100 companies working in the same industry. The big players are involved in product innovation involving R&D investment to develop multi-functional fluid additives, which offer a competitive edge over other players. Top market players handling diverse industry demands set them apart from other players. Market participants are also engaged in adopting strategic initiatives, such as new product development, partnership, acquisition, and others to gain a competitive edge. For instance, in January 2023, Paragon ISG acquired the Cinco Mud Solutions team and related assets, which is expected to drive the growth of the drilling fluids services of Paragon ISG. Some of the prominent players in the global drilling fluids market include:

• Baker Hughes, Inc.

• CES Energy Solutions Corp.

• Halliburton, Inc.

• Newpark Resources, Inc.

• Petrochem Performance Chemical Ltd. LLC

• Schlumberger Ltd.

• Scomi Group Bhd

• Weatherford International

Drilling Fluids Market Report Scope

Global Drilling Fluids Market Report Segmentation

This report forecasts revenue growth and provides an analysis of the latest trends in each of the sub-segments from 2018 to 2030. For this report, Grand View Research has segmented the global drilling fluids market based on product, application, and region:

• Product Outlook (Revenue, USD Million; 2018 - 2030)

  • Oil-based

  • Synthetic-based

  • Water-based

  • Others

• Application Outlook (Revenue, USD Million; 2018 - 2030)

  • Onshore

  • Offshore

• Regional Outlook (Revenue, USD Million; 2018 - 2030)

  • North America

    • U.S.

    • Canada

    • Mexico

  • Europe

    • U.K.

    • Norway

    • Russia

    • Azerbaijan

    • Kazakhstan

  • Asia Pacific

    • China

    • India

    • Pakistan

    • Myanmar

    • Thailand

    • Indonesia

    • Malaysia

    • Singapore

    • Australia

    • Vietnam

  • Central & South America

    • Brazil

    • Argentina

    • Venezuela

    • Columbia

    • Peru

  • Middle East

    • Saudi Arabia

    • UAE

    • Iran

    • Iraq

    • Qatar

    • Kuwait

  • Africa

    • Algeria

    • Nigeria

    • Libya

    • Gabon

    • Zaire (Republic of Congo)