Oilfield Market Report - Update

 

Oilfield Market Report Q1 2011:  By Richard Spears, Vice President.

The Oilfield Market Report is projecting that the global oilfield equipment and service market will rise to $276 billion in 2011, up 6% from $260 billion in 2010.  The all time record was $295 billion in 2008.  In 1999, the global market stood at $75 billion and has risen 10 of the last 12 years.  Of the 32 market segments in the current OMR, some will be growing as much as 25-35% in 2011 while others are falling 5-10%.

Spears & Associates created the Oilfield Market Report in the mid-‘Nineties as a way to track product line performance of the public and private companies working in the global oilfield equipment and service market.  Our first year we estimated the product line revenues of about 100 equipment and service companies, tracking about 20 different market segments.  After several revisions, we launched the current version of the OMR in 1999 with 300 oilfield service companies and 32 market segments.

Today the OMR is used by all first and second tier oilfield service companies, all major oil and gas companies, and a large portion of the investor community to monitor market share and market size information, to identify companies, product lines and technologies that are outperforming (and underperforming!) their peers, and to screen investment ideas.

The three largest market segments in 2011 will be offshore contract drilling ($35 billion), pressure pumping ($31 billion) and offshore construction ($28 billion).  Of those three, only pressure pumping services is growing (20% per year) while the other two are declining about 6% per year.  If these trends continue – and we expect that they will – in 2012 pressure pumping services will emerge for the first time as the largest segment of the global oilfield equipment and service industry.  The three leading pressure pumping service companies are Halliburton, Schlumberger and Baker Hughes, with a combined 66% of the market.

Of the 300 oilfield service companies in the database, about 100 are public and 200 are private.  The largest public companies are Schlumberger ($33 billion sales in 2010), Halliburton ($18 billion) and Baker Hughes ($16 billion).  The OMR also includes the oilfield sales of large industrial companies, like the unreported oilfield sales of Dover Corporation ($0.6 billion), and the unreported, but estimated sales of privately owned international service companies like Geolog ($0.1 billion).  Except for a few companies who do report their product line revenues, the vast majority of product line revenues in the OMR are estimates based on proprietary research conducted throughout the year by Spears & Associates.

The OMR is delivered to clients in two files – a book, which is published each fall, and an EXCEL workbook, which is updated every 3-4 months.  The EXCEL workbook contains all the data on the 300 companies we track, including product line sales estimates from 1999 through 2010, with market estimates for 2011.