The oil market is undergoing a significant increase in producers with an added increase in resource locations. Oil country tubular goods (OCTG) are required to facilitate both oil and gas wells. As oil and gas are being drilled in six major regions of the world, there is a potential for an increased need of OCTG’s. This increase is only reduced by the production and use of renewable energy.
The tube and pipe products used for the most popular energy resource, oil drilling, are made into oil pipes, drill pipes, and pipe casings. These oil country tubular goods are then shipped and used in one of six regions to service regional producers. These locations include Africa, Asia-Pacific, North America, South America and the Middle East.
South America is poised to experience the highest demand for OCTG as they are undergoing a tremendous energy growth, because of recently discovered underground oil reserves. These reserves are believed to hold 20% of the world’s underground oil. This new discovery will force OCTG production to increase. Market growth will only be tempered by the growth and acceptance of competing energy resources.
Even though growth is in play across the alternate energy industry, as more and more people become environmentally conscious, oil and gas still remain the most commonly used fuel source. Despite the aggressive competitors, the production of OCTG will have to grow to keep pace with future oil drilling. The anticipated growth of the market is 7% higher than 2014.
As South America unearths their underground reserves, more OCTG production will be needed. Now that it is popular to do shale and off-shore drilling, that growth is expected to reach $59 billion by 2019. Continued exploration and increased investing by gas and oil operators will likely result in more fossil fuel production.
More fossil fuel drilling requires more OCTG’s assuring the market’s continued optimum function. While the trends for alternate types of fuel are constantly varying, no one renewable source of energy is threatening fossil fuel production. Until that changes, OCTG’s will remain necessary for harvesting fossil fuels.