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The Oil Country Tubular Goods OCTG is an integral component of the oil and gas sector in most countries globally now operating within a constantly transforming environment impacted by various forces. The OCTG market is influenced by numerous factors including supply and demand influences, technological developments in this field as well as geopolitical aspects and regulatory bodies. With continuous changes in the energy landscape, the OCTG market sees volatility based on fluctuations witnessed from oil and gas exploration and production activities.The global energy demand is the main factor that drives dynamics in OCTG market. Changes in oil prices greatly influence the level of investment associated with exploration and production activities. High oil prices encourage companies that focus on supporting the production of crude petroleum and gas to increase their drilling activities, thus boosting demand for OCTG products like pipes and tubes. Similarly during a low period of oil prices exploration and production activities may reduce, which affect the OCTG market negatively.
It is also worth noting that technological advancements help to define the current state of affairs in the OCTG market. Innovations in drilling and extraction technology impact the demand for specific types of OCTG products. For instance, the introduction of horizontal drilling and hydraulic fracturing methods has heightened demand for highly durable pipes that are corrosion-resistant. With the development of technology, OCTG manufacturers need to be able to cope with new requirements established in this industry.
In the OCTG market, geopolitical factors introduce an inherent uncertainty. The global supply chain of OCTG products can also be disrupted by political instability in major oil-producing regions, trade tensions and geopolitical conflicts. These uncertainties cast both oil and gas companies as well OCTG manufacturers in the fluctuating prices of products supply availability affecting their decision-making processes.
Lastly, the OCTG market is also significantly influenced by regulatory developments. An impact on the production, distribution and consumption of OCTG products can be made by environmental regulations, safety standards as well as trade policies. OCTG manufacturers may need to spend on research and developing new products that can comply with changing rules. Further, trade practices and tariffs may affect the prices of OCTG products as well as market trends.
OCTG market is also affected by the cyclical nature of oil and gas production industry. Price and profit margins of the OCTG manufacturers can vary significantly with periods of oversupply or undersupplies. Companies in this market have to manage their way through these cycles by using well-developed risk management strategies and having elastic production capacities.
Of conclusion, the market forces of OCTG sector are interrelated to global energy demand system changes in technology geopolitical factors and changes associated with regulations. Furthermore stakeholders in the OCTG market must be keen and flexible enough to these dynamics so that they could take advantage of opportunities on hand as well as reduce their chances for vulnerabilities. As changes occur in the energy landscape, shifts are also anticipated to continue occurring within the OCTG market and shape how this industry takes on its future.
Global OCTG Market Overview:
The OCTG market size was valued at USD 17.6 billion in 2022. The OCTG industry is projected to grow from USD 18.64 billion in 2023 to USD 29.61 billion by 2032, exhibiting a compound annual growth rate (CAGR) of 5.95% during the forecast period (2024–2032). Rise in the upstream oil & gas operations and, development of deepwater and offshore reserves in challenging environments, and increasing exploration and production activities are the key market drivers enhancing the market growth.
Source: Secondary Research, Primary Research, MRFR Database, and Analyst Review
OCTG Market Trends
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The exponential possibility of finding conventional and unconventional resources is driving market growth.
Market CAGR for OCTG is being driven by the growing potential in discovering conventional and unconventional reserves. Government and private entities are interested in discovering recent oil well reserves to fulfill future energy demands. A massive chunk of investment by key organizations in unlocking significant oil and gas reserves is set to drive the oil government tubular goods market. Additionally, the shale gas revolution in the U.S. is attracting more investors to invest in analyzing unconventional energy sources. Also, numerous countries are striving hard to facilitate foreign trade on imports of hydrocarbons by realizing conventional and unconventional resources in their territorial boundaries, fueling the OCTG market growth.
Additionally, the economic resurgence in various parts of the globe has expanded energy consumption. Oil and gas is the major source in the overall energy outlook of the globe. Hydrocarbons are broadly utilized in several operations, such as power generation, processing, transportation, and manufacturing. One of the highest OCTG market trends is the exponential acquisitions by oilfield service providers and operators in investigation and production activities to meet the massive demand for oil and gas. A tremendous growth in drilling operations in different parts of the globe and the industry's continuous growth is likely to drive the OCTG market revenue.
The increase in deepwater exploration in remote areas with harsh environments has increased the use of premium quality drilling equipment, resulting in the market's growth. The Middle East is the major offshore deepwater reserve and is anticipated to boost production during the forecast period. The deployment of the entire rig calculations in the US surged from 369 in January 2021 to about 601 in January 2022, detecting a growth of 63% due to the country's growing oil and gas drilling movements. An identical trend was noticed in Canada, which registered an expansion of 39% in drilling rig deployment from 137 in January 2021 to 190 rigs in January 2022. Such systems are anticipated to resume and expand OCTG demand during the forecast period.
OCTG Market Segment Insights:
OCTG Type Insights
The OCTG market segmentation, based on type, includes tubing, casing, and drill pipe. The drill pipe segment dominated the market, accounting for 35% of market revenue (78.48 Billion). In developing economies, category growth is driven by growing investment in onshore drilling procedures to create a significant amount of hydrocarbons. Onshore drilling has been carried out over various decades more easily than its counterpart. However, casing is the fastest-growing category as well casing is a quintessential element in drilling as it assists in avoiding contamination of groundwater and stabilizes uninterrupted drilling operations.
OCTG Make Insights
The OCTG market segmentation, based on make, includes seamless and welded. The seamless category generated the most income (70.4%). The surge in the usage of seamless tubes in the oil & natural gas industry is mostly as it is extruded and drawn from a billet. However, welded is the fastest-growing category as they are easily customized according to operational needs.
OCTG Grade Insights
The OCTG market segmentation, based on grade, includes premium and API. The premium category generated the most income (70.4%). The development and investigation of oil & natural gas fields in offshore regions and the need for high grade transportation tubes, which can resist corrosion, have guaranteed leakproof performance, and sealing integrity of the connections even when subjected to a combination of loads, bending, and high internal pressure. However, API is the fastest-growing category due to increased deepwater exploration in remote areas.
Figure 1: OCTG Market, by Grade, 2024 & 2032 (USD Billion)
Source: Secondary Research, Primary Research, MRFR Database, and Analyst Review
OCTG Regional Insights
By region, the study provides market insights into North America, Europe, Asia-Pacific, and the Rest of the World. The North American OCTG market area will dominate this market, owing to enormous drilling activities across the region. Favorable government policies and investments by some of the notable players in this region. Further, the US OCTG market held the largest market share, and the Canada OCTG market was the fastest-growing in the North America region.
Further, the major countries studied in the market report are The US, Canada, German, France, the UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil.
Figure 2: OCTG Market Share By Region 2022 (USD Billion)
Source: Secondary Research, Primary Research, MRFR Database, and Analyst Review
Europe OCTG market accounts for the second-largest market share due to the increasing oil and gas exploration and production operations in the region driving market growth. Further, the German OCTG market held the largest market share, and the UK OCTG market was the fastest-growing market in the European region.
The Asia-Pacific OCTG market is expected to grow at the fastest CAGR from 2023 to 2032. This is due to increasing oil and gas exploration and production operations in the region. Moreover, the China OCTG market held the largest market share, and the India OCTG market was the fastest-growing market in the Asia-Pacific region.
OCTG Key Market Players & Competitive Insights
Leading market players are investing heavily in research and development to expand their product lines, which will help the OCTG market grow even more. Market participants are also undertaking various strategic activities to expand their footprint, with important market developments including new product launches, contractual agreements, higher investments, mergers and acquisitions, and collaboration with other organizations. To expand and survive in a more competitive and rising market climate, the OCTG industry must offer cost-effective items.
Manufacturing locally to minimize operational costs is one of the key business tactics used by manufacturers in the OCTG industry to benefit clients and increase the market sector. Major players in the OCTG market, including National-Oilwell Varco Inc., ILJIN Steel Co., Nippon Steel & Sumitomo Metal Corporation, ArcelorMittal SA, Tenaris SA., and others, are attempting to increase market demand by investing in research and development operations.
Tenaris SA, a subsidiary of The Techint Group, manufactures steel pipe products. It carries out the presentation and marketing of seamless steel and welded steel tubular developments and affiliated services. The firm's portfolio of products includes casing, line pipe, tubing, and mechanical and structural pipes. Tenaris serves oil and gas firms and engineering firms engaged in constructing oil and gas gathering, processing, transportation, and power generation facilities. It operates a worldwide network of steel pipe manufacturing, research, finishing, and service facilities. In November 2020, Tenaris launched its Rig Direct service for OCTG, which permits consumers to purchase and operate their tubular online, with real-time access to prices, inventory, and delivery status.
Vallourec SA (Vallourec) is a manufacturer of tubular solutions. It designs, develops, and produces hot-rolled seamless steel tubes and welded tubes. The company's product portfolio includes seamless tubes and connections; heat exchanger tubes and steam generator tubes; carbon and alloy steel pipes; hydraulic cylinders and precision tools; and hot finished structural hollow sections. Vallourec serves customers in the oil and gas, power generation, automobile, mechanical, construction, and other sectors in Europe, North America, South America, Asia, the Middle East, and other regions. It has manufacturing, sales, and other facilities across the world. In September 2019, Vallourec established its unique VAM SPRINT-SF connection for OCTG, which features a high-performance seal and improved torque capacity for challenging drilling environments.
Key Companies in the OCTG market include
- Nippon Steel & Sumitomo Metal Co. (Japan)
- Vallourec (France)
- Tenaris(Europe)
- National Oilwell Varco (U.S.)
- TMK (U.S.)
- Steel Tubular Products Inc (NA).
- ILJIN STEEL CO (S. Korea)
- Continental Alloys (Malaysia)
- Anhui Tianda Oil Pipe Company (China)
OCTG Industry Developments
December 2022:Â Vallourec secured a third prominent order in the framework of the Long-Term Agreement (LTA) signed in 2021 with ExxonMobil Guyana. Under the contract, Vallourec will deliver line pipe for ExxonMobil Guyana's deepwater Uaru project.
August 2022:Â Abu Dhabi National Oil Organization was awarded a five-framework agreement valued at USD 1.83 billion for logging during drilling and directional drilling. The project includes wellheads and related components, downhole completion equipment and associated services, liner hangers, cementing services, wireline logging, and directional drilling. With this framework agreement, the company aims to drill new wells and expand its production capacity.
January 2022: Jindal SAW announced that it had formed a joint venture (JV) with Hunting Energy Services to set up an OCTG threading plant in Nashik, India. The plant will manufacture the equipment used in oil and gas drilling services. The initial investment will be around USD 20–25 million in a 51:49 partnership in which Jindal SAW is the majority shareholder. The installation was actived by the end of 2022.
OCTG Market Segmentation
OCTG Type Outlook
- Tubing
- Casing
- Drill Pipe
- Others
OCTG Application Outlook
- Onshore
- Offshore
OCTG Make Outlook
- Seamless
- Welded
OCTG Grade Outlook
- Premium
- API
OCTG Regional Outlook
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North America- US
- Canada
-
Europe- Germany
- France
- UK
- Italy
- Spain
- Rest of Europe
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Asia-Pacific- China
- Japan
- India
- Australia
- South Korea
- Australia
- Rest of Asia-Pacific
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Rest of the World- Middle East
- Africa
- Latin America
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