As per the report published by Kings Research, the global Oilfield Chemicals Market was valued at USD 29.09 Billion in 2022. The market is projected to reach USD 39.68 Billion by 2030, growing at a CAGR of 4.05% from 2023 to 2030.
The global market is anticipated to be fueled by factors such as rising product demand in several petroleum operations, including production, drilling, stimulation, enhanced oil recovery, cementing, and hydraulic fracturing. Over the projected period, it is anticipated that increasing crude oil output and switching to unconventional drilling techniques is likely to have the potential to boost demand for the oilfield chemicals market.
The increasing price fluctuation of crude oil due to the Russia-Ukraine war and increasing environmental concerns is hampering the market for oilfield chemicals. The potential impact of oilfield chemicals on the environment is an important consideration due to their level of biodegradability and toxicity. Certain oilfield chemicals have been found to contain strong persistence within the environment, sometimes lasting for multiple years. Accidental discharges or leaks of such chemicals represent a risk to biodiversity and the health of ecosystems, including plant life and wildlife. Such instances could pose a challenge to market growth.
Key Insights
- Based on the application, the corrosion & scale inhibitor segment held the largest market share of 36.78% in 2022
- Based on chemical type, the drilling & cementing segment generated the highest revenue of 11.27 billion in 2022
- Based on region, MEA accounted largest market share of 36.54 in 2022
Key Developments
Natural Gas Minister Announcement of New Investment
September 2021: Union Petroleum and natural gas minister of India announced that an investment of 12.167 billion USD has been approved for oil and gas projects in the northeastern region of India
Clariant Oil Services Expansion in MEA Region
October 2022: Clariant oil services a major player in specialty oilfield chemicals announced its expansion in MEA with the new launch of its state-of-the-art facility for advanced oil and gas solutions
Strict Government Regulations and Changing Trade Policies to Restrain Market Growth
The major factor hampering market growth is the strict regulation imposed by the government and changing policy. Chemical regulations are dynamic and are constantly changing as per compliance requirements. Currently, most countries have their own set of regulations, requirements, and certifications for the import and export of their products, which makes it difficult for companies to trade globally.
For example, if a company wants to export goods to Europe, it must be registered under Registration, Evaluation, Authorization, and Restriction of Chemicals (REACH), which provides a high level of protection for human health and the environment from the use of chemicals and also allows free movement of products in the EU market.
For instance, countries such as China, Japan, Vietnam, India, and others focusing on revising their existing chemical regulation. Hence changing rules and regulations is hampering the market growth.
Increasing Number of Projects for Water Treatment is Propelling the Market Growth
Chemicals from the oilfield are used for the water treatment process. Some of the chemicals used for the process are chlorine, chlorine dioxide, and chloramine, which help to remove bacteria and viruses from the water. Currently, chemical companies are employing advanced water treatment techniques to ensure that clean water is supplied for end-user industries such as cooking, irrigation, and washing.
- For instance, Lanxess, a Berlin-based specialty chemicals company, has introduced a new wastewater treatment plant. The company invested around 12 million euros in the plant, which has a treatment capacity of 260,000 liters of wastewater per hour.
MEA Takes the Lead in Oilfield Chemicals Market Amidst Increasing Demand and Favorable Government Initiatives in Saudi Arabia
The MEA dominated the market share and is anticipated to grow at a CAGR of 4.82% during the forecasted period from 2023 to 2030. The region is witnessing a growing demand for oilfield chemicals, due to escalated activities related to drilling and oil exploration, which are carried out to fulfill the surging demand for crude oil and natural gas on a global scale.
Additionally, Saudi Arabia's favorable location and close boundaries to other OPEC countries have led to few businesses considering domestic production there due to various government initiatives to support business in the country.
Market Players are Investing in New Technology to Improve Their Presence
The market is consolidated with key players such as Nouryon, Ashland, BASF SE, Dow, Chevron Phillips Chemical Company LLC., Halliburton Energy Services, Inc., SLB, Solvay, Baker Hughes Company, and Champion X. Companies employ a variety of strategic measures such as acquisitions, mergers, partnerships, product introductions, and collaborations to expand their business globally and enhance their competitive position.