Current Trends in the Oil & Gas Industry

Investors in the oil & gas industry know that prices tend to rise and fall in a cyclical fashion. As populations grow, as the industry develops, and as lifestyles advance, the demand for energy grows and prices rise. As the revenues get reinvested in production to meet these demands, prices tend to fall again. Since oil prices bottomed out at less than $27 a barrel in 2016, supply and demand are gradually coming back into balance, and investors are considering the near future with cautious optimism. As an industry and API standard leader in pipe protection products, Essentra Pipe Protection Technologies aims to stay up-to-date with current oil & gas industry trends, while also keeping customers in the know.

Rig Counts

One of the factors that investors take into consideration is the number of U.S. oil rigs in service at a given time. Unlike Saudi Arabian drilling operations, which are owned and controlled by the government, U.S. rigs operate independently and reflect rather than manipulate the current state of the market. The idea is that, as oil & gas industry prices rise, more oil rigs will be put into service, which increases supply. According to a report by the American Petroleum Institute in July, the number of active rigs in both oil and gas drilling operations showed a year-over-year increase of 62% in the second quarter of 2017. However, the increase in supply is likely to prevent a dramatic rise in prices.

Shale

The development of horizontal drilling and fracking started a shale boom that took off in 2008 and rose rapidly for the next seven years, leading the U.S. to become the world’s top producer of natural gas and a close competitor to Saudi Arabia in oil production. However, the rapid increase in supply had a major impact on oil prices. Now, it seems that production may be slowing down at last, according to Halliburton, which is the top fracking services provider in the U.S. Industry experts say that much depends on the behavior of investors who, up to now, have rewarded growth.

In the third quarter of 2017, investors are expecting modest growth as supply slows and oil companies consolidate. The market for oil country tubular good products is expected to remain healthy with continued growth over the coming years. Oil & gas industry companies depend on top-quality oilfield products from best-in-class providers, like Essentra Pipe Protection Technologies, to guarantee safe and productive operations. Connect with an Essentra customer service expert at 877-276-9208, or request a quote now!