Industry Analysis & Industry Trends
Operators in the Oil and Gas Field Services industry primarily provide services to oil and gas extractors, making demand highly dependent on oil and natural gas prices. Over the past five years, divergent US and global energy prices stemming from the recession resulted in volatile year-on-year revenue growth. Nevertheless, revenue has increased overall due to steadily growing global demand for energy and recovery from recessionary lows. In the coming years, demand for oil and gas field services is projected to rise, as the global economy recovers. However, low US natural gas prices will likely continue to constrain industry growth. Stringent offshore drilling permit regulations in the Gulf Coast will also offset some revenue gains derived from an increase in crude oil prices... purchase to read more
Industry Report - Industry Investment Chapter
This industry has a high level of capital intensity, and it employs a substantial workforce. Industry services heavily rely on capital equipment, including sophisticated offshore and onshore oil and gas drilling rigs. Operators also compete based on the quality of their technology; therefore, they significantly invest in researching, developing and obtaining the latest and most efficient technology and machinery. In 2015, for every dollar spent on labor, an estimated $0.35 is spent on capital investments.
Positioning and operating drilling rigs, including various types of offshore rigs, require considerable skill, which is reflected in the large share of revenue consumed by wages... purchase to read more