New York, NY (PRWEB) April 07, 2014
The Oil and Gas Extraction industry has been booming in the five years to 2014. While the recession negatively impacted oil prices, especially in 2009 when the world price of crude oil rose 36.3%, new technologies and extraction techniques have enabled the industry to quickly recover from the negative shocks of the economic downturn. According to IBISWorld Industry Analyst James Crompton, “Domestic production of oil and gas has steadily increased in the five years to 2014, and industry operators have positioned themselves to continue performing strongly in the five years to 2019.” Though the industry remains exposed to global commodity price fluctuations, IBISWorld expects that the industry will continue to profit from its highly lucrative operations, and industry revenue is expected to increase by 3.6% in 2014.
In the five years to 2014, industry revenue is expected to increase. The industry is composed of several very large globalized companies that engage in all steps of the oil and gas production process, from exploration to refining, and it is these companies that are poised to benefit the most from the emergence of hydraulic fracturing and horizontal drilling techniques. Furthermore, the United States has been seeking to lessen its reliance on foreign sources of oil and gas, most notably those in the Middle East. By reducing exposure to foreign political events and pressure, domestic operators are expected to perform strongly as domestic demand is increasingly met by domestically produced oil and gas resources.
The future of oil and gas is expected to increasingly hinge on improving technology and techniques. “As industry operators deplete their reserves, it is necessary to improve efficiency and minimize waste,” says Crompton. Industry operators replenish their reserves through either acquisitions or exploration, with exploration efforts being the much more speculative endeavor. Nonetheless, the number of industry operators has been increasing and is expected to continue doing so, as previously uneconomical resources have become accessible. In the five years to 2019, IBISWorld expects industry revenue to expand. Improving technology is anticipated to assist operators in meeting environmental concerns and maximize well efficiency, and as a result, IBISWorld expects that industry operators will be able to continue operating profitably and successfully in the United States.
Concentration in the Oil Drilling and Gas Extraction industry is low. The four largest firms in the industry are ConocoPhillips, Chevron Corporation, Royal Dutch Shell Oil PLC and BP PLC. Low concentration reflects the industry's large size and its dispersion across the nation, making it difficult for even major oil companies to control more than a small share of output. During the five years to 2014, market concentration has decreased slightly as formerly integrated companies, such as ConocoPhillips and Hess, divested downstream segments to maximize efficiency and operating margins.
For more information, visit IBISWorld’s Oil Drilling and Gas Extraction in the US industry report page.
Follow IBISWorld on Twitter: https://twitter.com/#!/IBISWorld.
Friend IBISWorld on Facebook: http://www.facebook.com/pages/IBISWorld/121347533189.
IBISWorld industry Report Key Topics
Companies in the Oil Drilling and Gas Extraction industry operate and develop oil and gas field properties. Activities include the exploration and production of crude petroleum; the mining and extraction of oil from oil shale and oil sands; the exploration and production of natural gas; sulfur recovery from natural gas; and recovery of hydrocarbon liquids. Companies may operate oil and gas wells on their own account or for others on a contract or fee basis.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.