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July 15, 2020

Oil and gas drilling unlikely to recover to its 2019 levels soon

A Rystad Energy analysis has predicted that the number of drilled wells globally will reach approximately 55,350 this year, the lowest since the beginning of the century, due to the Covid-19 pandemic’s unprecedented hit to oil and gas activity.

By Yoana Cholteeva

A Rystad Energy analysis has predicted that the number of drilled wells globally will reach approximately 55,350 this year, the lowest since the beginning of the century, due to the Covid-19 pandemic’s unprecedented hit to oil and gas activity.

This years’ decline marks a 23% fall from 2019’s 71,946 drilled wells, prompting Rystad to predict that last year’s numbers will not be met or exceeded until at least 2025.

According to the forecast, drilled wells are to partly recover, to just above 61,000 in 2021, as governments ease travel restrictions, boosting oil demand and prices. Then numbers are expected to grow further, to just above 65,000 in 2022, although they will remain below 69,000 until the end of 2025.

Rystad energy services analyst Reza Hassan Kazmi said: “Both new wells and drilling lengths will be pared down as E&P’s scale down investments, affecting the entire supply chain associated with these services. This includes drilling tools, which will decline by 35% in 2020 compared to 2019.”

Read the full article here

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