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The global measurement while drilling market size stood at USD 1.79 billion in 2019 and is projected to reach USD 2.15 billion by 2027, exhibiting a CAGR of 7.2% during the forecast period.
The world economy is shrinking due to the coronavirus pandemic, which has severely hit economic activities around the world. Businesses around the world are on a virtual standstill to contain the spread of the virus. It has also crumbled the balance sheet of oil and gas companies. Many companies are experiencing heat due to a sharp fall in crude oil prices in the international market. Oilfield services companies and operators are deferring investment in new projects to mitigate the financial impact of the COVID-19 outbreak. Government entities and international organizations are working together to provide impetus to the hydrocarbon industry through strategic planning, bilateral talks between producers and consumers, and tax incentives to ease the impact. The market is projected to rebound once the economic activities start across the globe. Though the oil and gas industry is crumbling, it will also experience new opportunities in the post-nCovid-19 period. This will undoubtedly attract investors to invest in exploration and production activities that boost the demand for measurement while drilling.
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Spurring Demand for Hydrocarbons to Expand Opportunities
The persistent demand for oil and gas from different industry verticals present wide-ranging lucrative opportunities. All the countries are striving hard to attain economic development and are massively investing in the energy sector to meet the inflating demand. In addition, population explosion has raised the demand for consumer goods, resulting in industrial expansion. Similarly, the exponential infrastructure and construction activities, predominantly taking place in developing nations, are increasing the demand for hydrocarbons. Following this trend, national oil companies and operators are investing in new projects to meet the demand, which in turn is boosting the MWD market growth.
Sharp Rise in Adoption of Advanced Technologies to Optimize Drilling Operations to Fuel the Market
Technological advancement over the years has allowed drilling at deeper levels. Oilfield service companies are drilling deeper to discover enormous hydrocarbon reserves. Specialized equipment and methods used in this process increase operational reliability while enhancing production. MWD system is able to operate in the harshest environments and provide directional survey data (well path), bottom hole temperature, pressure, drilling parameters, and others. Drilling can be done efficiently after observing these parameters to optimize operations.
Growing Focus on Directional Drilling to Propel Market Growth
Directional drilling is experiencing massive growth as it opens multiple opportunities to exploit hydrocarbon wells, which is not possible through vertical drilling. For instance, hydraulically fractured horizontal wells accounted for 69% of oil and natural gas wells drilled in the U.S. for the total linear footable drilling in 2018. In addition, the shale gas revolution in the U.S. is likely to boost the demand for measurement while drilling tools and services to analyze wellbore conditions effectively, which will augur well for the measurement while drilling market growth.
Inflating Exploration and Production Activities Set to Augment the Market
Consistent investment by major operators for exploration and production (E&P) activities to meet the growing demand for hydrocarbons is set to boost the MWD market outlook. Developing nations are increasingly investing in E&P activities to increase domestic production and reduce the foreign exchange on imports of oil. Measurement while drilling offers a unique solution to analyze wellbore parameters to carry out drilling operations effectively. The oilfield service companies are eyeing for optimum utilization of available resources, which is further driving the market.
Shrinking Investment due to Pandemic Outbreak and Volatile Prices to Limit Growth
The economic slowdown caused by the coronavirus outbreak has put the world in a grave crisis. All economic activities are closed due to lockdowns announced by authorities to contain the spread of the COVID-19 infection. Oil and gas companies have been hit hard by this pandemic, with many of them fearing bankruptcy. Many companies are cutting down capital and operational expenditure to mitigate the impact. Furthermore, the recent price war between Russia and Saudi Arabia has made crude oil prices highly volatile in the international market. Investors are in a traumatic situation and are procrastinating new projects due to the volatile market. All these factors are significantly reducing the exploration and production activities, restraining the growth of the MWD market.
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Consistent Investment in Land-Based Exploration to Strengthen the Onshore Segment
A large share of oil and gas production comes through onshore drilling owing to the ease of operation and availability of resources. Onshore exploration is one of the more reliable and traditional methods of extracting hydrocarbon from wells. The cost of drilling is economical as compared offshore drilling. Furthermore, onshore drilling offers more options for storage and transport of oil after it is extracted from the well, whereas, offshore drilling requires special equipment and methods for processing the oil and transporting it after extraction. However, high presence of untapped hydrocarbon reserves is likely to expand investment in offshore drilling.
North America Measurement While Drilling Market Size, 2019 (USD Billion)
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The global market is classified into five regions, viz. North America, Latin America, Europe, Asia-Pacific, and Middle East & Africa. MWD is witnessing steady growth on account of rising demand for advanced technologies for cost-effective drilling operations. North America is experiencing healthy growth on account of exponential directional drilling operations in the United States. In addition, the shale gas revolution bolstering the region’s position in the measurement while drilling market share. However, the United States economy is severely hit by the coronavirus pandemic. Many major cities in the country are in facing the brunt of lockdowns to contain the virus spread. Oil and gas companies have stalled their operations and are delaying new projects to mitigate the effects of the outbreak. Latin America is expected to observe moderate growth, with activities being mainly concentrated in Brazil, Mexico, and Venezuela.
The coronavirus outbreak has severely hit European countries and economic activities are on a virtual standstill. The key economies in Europe, such as the UK, Germany, Italy, and Russia, are taking precautionary measures to contain the spread of the virus. Though the market has crumbled due to pandemic, it is anticipated to rebound in the forecasted period owing to the consistent demand for hydrocarbons.
Similarly, Asian countries are undergoing tough situations due to the rising number of positive Covid-19 cases. The coronavirus first emerged in China and spread globally, causing shrinking of the global economy. China is partially opening its markets amid pandemic fears and allowing operators to carry out business activities. In contrast, the Indian government announced nationwide lockdown in March to contain the spread of corona pandemic, thereby jamming the economic activities. This will certainly strike the market, but there are a number of opportunities post recovery from the Covid-19 outbreak. The oil baron countries in the Middle East have tentatively agreed to cut the production of oil and gas to ease the crumbling market. All the major companies cutting down capital and operational expenditure to attain a steady position in the market.
Rising Concentration on Optimizing Production Costs to Make Market Competition Fierce
The measurement while drilling market is highly dominated by some of the leading companies in the world. Drilling in complex and high-depth wells is only possible through the application of cutting edge technology. MWD provides real-time information about the formation and drill bit to ease the drilling operation. The unpredictable market scenario and growing demand for the economical production of hydrocarbons offer lucrative opportunities to the companies. Hence, the spurring demand for cutting edge technology to cut down production costs is set to offer healthy completion among the market players.
The volatile nature of the hydrocarbon industry and the recent coronavirus outbreak have deferred all new projects to cope up with the situation. Many countries have announced nationwide lockdowns to contain the spread of the nCovid-19 infection. However, the lockdown has hit hard the global economy and crumbled the financials of different industry verticals. The oil production war between Saudi Arabia and Russia has caused crude oil prices to plummet to their lowest. However, the recent meeting held by OPEC+ reached to tentative agreement to trim oil production by 10 million barrels per day (BPD) to ease the economic impact of the coronavirus on global demand. Governments are also offering packages to mitigate the severe threat caused by the pandemic. Therefore, in a couple of years, the market will rebound to steady-state with new opportunities and investments.
The measurement while drilling market report offers an elaborative analysis of numerous factors affecting this market. These include opportunities, growth drivers, threats, key developments, and restraints. In addition to this, it further helps in analyzing, segmenting, and defining the market based on different segments such as casing type and application. It strategically analyzes several strategies such as product innovations, mergers, alliances, joint ventures, and acquisitions adopted by players in the industry. The report also includes a qualitative analysis of the impact of COVID-19. It includes key initiatives taken by governments to provide impetus to the crumbling hydrocarbon industry, potential opportunities, and challenges due to pandemic and others.
An Infographic Representation of Measurement While Drilling Market
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Besides this, the report provides a comprehensive analysis of market dynamics, emerging trends, and the competitive landscape of the MWD market. Key insights offered in the report are the adoption trends of residential industry analysis by individual segments, recent industry developments such as partnerships, mergers & acquisitions, consolidated SWOT analysis of key players, Porter’s five forces analysis, and key industry trends.
Value (USD Billion)
As per Fortune Business Insights study, the global measurement while drilling market is forecasted to reach USD 2.15 billion by 2027 at a CAGR of 7.2% (2020 -2027).
In 2019, the global measurement while drilling market size was USD 1.79 billion and is anticipated to reach USD 2.15 billion by 2027 growing at a steady CAGR of 7.2% during the forecast period (2020 -2027).
The onshore segment is set to lead the measurement while drilling market on account of persistent investment.
The measurement while drilling market size in North America stood at USD 0.67 billion in 2019.
Spurring demand for advanced technology to optimize drilling operation is driving the market.
Schlumberger, Baker Hughes, Halliburton, and Weatherford International are some of the top players in this market.
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