Impact of Crude Oil Prices on Oilfield Chemical Markets
- Oilfield chemicals are used in all the various stages during the entire lifecycle of a well. Prior to the crude prices drop in 2014, the market for oilfield chemicals was showing a strong growth.
- Much of this growth was attributed to North American unconventional drilling which require oilfield chemicals in high volumes. However following the crude prices drop, unconventional drilling has reduced not only in North America but all across the globe as well.
- This article focuses on the impact of these reduced drilling and stimulation activities on the global oilfield chemicals market and the opportunities for E&P players in the current market conditions.
How are the crude oil prices and oilfield chemicals market linked? Oilfield chemicals have seen a rapid rise in demand in the last decade. The market has grown at a CAGR of 8.5% since 2009 to 2014. One of the major drivers of this increased demand is the increased unconventional activities. USA and Canada have witnessed tremendous growth in Shale, hydraulic fracturing and horizontal drilling which require huge amounts of oilfield chemicals and hence, North America has been the major consumer of oilfield chemicals. High crude oil prices helped in boosting the demand before the prices started declining in 2014. Author: Rajesh Mohan Rana
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