Electric Submersible Pump Manufacturing in the US Industry Market Research Report from IBISWorld Has Been Updated

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Fortunately for the industry, oil prices are expected to rebound over the next five years as major producers tighten supply on the world market and, as a result, ESP sales will grow in line with increased US rig counts as rising crude prices spur ongoing production efforts. For these reasons, industry research firm IBISWorld has updated a report on the Electric Submersible Pump Manufacturing industry in its growing industry report collection.

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Industry sales will grow in line with US rig counts as rising crude prices spur ongoing production efforts

The Electric Submersible Pump Manufacturing industry benefits from near-constant demand for oil and gas. Electric submersible pumps (ESPs) are a type of downhole device used on drilling rigs to provide artificial lift for subterranean liquids like oil and water. According to industry leader Schlumberger, only a small percentage of the world's nearly one million oil- and gas-producing wells flow naturally, so much of the world's oil and gas production relies on artificial lift devices such as ESPs. This near-universal need has been a boon to the industry over the five years to 2015, supporting annualized revenue gains.

Nevertheless, Electric Submersible Pump Manufacturing industry revenue is forecast to decline over 2015, commensurate with challenging conditions in downstream energy markets. The ESPs produced by this industry largely serve one downstream market: oil extraction. “In turn, that market fluctuates alongside global prices for crude oil, with a lag of a few years arising from long lead times associated with surveying, rig construction and exploration,” IBISWorld Economic Analyst Amal Ahmad says in the updated report. Oil prices, which exceeded $100 a barrel in 2013, have fallen sharply since the end of 2014 due to global oversupply. By 2015, the price of crude oil is expected to have lost over half of its value, forcing losses on oil and gas companies and limiting their demand for ESPs. However, average profit is expected to remain stable, buoyed by the margins of the largest industry operators.

Fortunately for the industry, oil prices are expected to rebound over the next five years as major producers tighten supply on the world market. As a result, ESP sales will grow in line with increased US rig counts as rising crude prices spur ongoing production efforts. Industry operators are also expected to benefit from ongoing technological innovation. “ESPs are usually part of a larger system of retrieval, monitoring and other devices, and growing sophistication regarding installation techniques and real-time data feeds are increasing the value of an already crucial component for downstream drillers,” Ahmad says in the updated report. Through 2020, revenue is forecast to increase.

For more information, visit IBISWorld’s Electric Submersible Pump Manufacturing in the US industry report page.

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IBISWorld industry Report Key Topics

This industry manufactures electric submersible pumps (ESPs) for oil and gas well drilling. Firms also provide monitoring systems, equipment engineering and other services that complement ESP systems.

Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
Globalization & Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
Major Companies
Operating Conditions
Capital Intensity
Key Statistics
Industry Data
Annual Change
Key Ratios

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.

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Gavin Smith
IBISWorld
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