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The offshore support vessel market size is estimated to grow at a CAGR of 5.41% between 2022 and 2027. The market size is forecast to increase by USD 525.58 million. The growth of the market depends on several factors, including the rise in global demand for oil and natural gas, the rise in deep-water and ultra-deep-water E&P activities, and the increase in global offshore oil and gas exploration activities.
This offshore support vessel market report extensively covers market segmentation by application (oil and gas and offshore wind), product (AHTS, PSV, MPSV, FSIV, and others), and geography (North America, Europe, APAC, Middle East and Africa, and South America). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.
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The rise in global demand for oil and natural gas is notably driving market growth, although factors such as fluctuations in the price of crude oil may impede market growth. Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
One of the key factors driving the global offshore support vessel market growth is the rise in global demand for oil and natural gas. The global demand for oil and natural gas is increasing steadily owing to improvements in global economic growth. For instance, according to the EIA, global oil consumption is projected to reach 104.1 mb/d by 2026. This will represent an increase of 4.4 mb/d from 2019 levels. According to the IEA, the demand for oil will continue to grow till 2040, and the use of natural gas will rise by 45% by the same year, with high scope for expansion in the power sector.
Though the costs involved in the production of oil and gas from offshore locations are higher than that of onshore locations, the proven reserves in offshore wells are far higher when compared to onshore wells. These vast reserves are expected to attract upstream companies to exploit and produce oil and gas. In addition, with the rise in fuel consumption from developing economies such as China and India, the demand for natural gas is expected to grow significantly during the forecast period.
Reduction in cost of offshore E&P activities is one of the key offshore support vessel market trends that is expected to impact the industry positively in the forecast period. The global price of crude oil has been gradually increasing and is expected to average USD 74/bbl in 2022. Though this increase is not yet significant enough to revive investments in global offshore drilling projects to pre-2020 levels, it is sufficient to cause a moderate increase in the global count of active offshore rigs. The biggest factor that bodes well for offshore E&P activities and the demand for new offshore support vessels is technological and managerial initiatives taken by oil E&P companies that have decreased the cost of offshore exploration, drilling, and production.
For instance, Shell's Vito, a deep-water development project in the US Gulf of Mexico, has a break-even price of less than USD 35 per barrel. This was achieved by reducing the cost of production by almost 70%. Thus, offshore rig operators have started to operate wells that were previously not commercially viable. This is expected to lessen the impact of onshore fracturing activities on global offshore E&P activities. As a result, investments in offshore projects can be taken with more certainty. This trend is likely to positively impact the demand for offshore support vessels during the forecast period.
One of the key challenges to the global offshore support vessel market growth is the environmental concerns associated with offshore E&P activities. Factors such as, owing to the pollution of air and water by the accidental release of toxic chemicals and global warming due to large emissions of greenhouse gases such as methane. In addition, in offshore drilling, produced water accounts for about one-fifth of the waste generated during the process. Offshore exploration activities also involve the firing of air guns, which sends a strong shock across the seabed and can damage the hearing ability of marine animals.
Moreover, fracking also produces large amounts of wastewater that contains dissolved chemicals and contaminants. The global warming potential of methane is far higher than that of carbon dioxide. There is uncertainty about the amount of methane that is released into the atmosphere during the fracking process, and it cannot be captured. Such factors are expected to limit the growth of the market in the forecast period.
The report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Offshore Support Vessel Market Customer Landscape
Vendors are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
AP Moller Maersk AS: The company has offshore support vessel vega, which includes carrying and transporting large quantities of cargo.
The report also includes detailed analyses of the competitive landscape of the market and information about 15 market vendors, including:
Qualitative and quantitative analysis of vendors has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize vendors as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize vendors as dominant, leading, strong, tentative, and weak.
The market share growth by the oil and gas segment will be significant during the forecast period. The demand for offshore support vessels in the oil and gas segment is expected to increase during the forecast period. This is primarily because of the rising demand for oil and gas E&P projects.
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The oil and gas segment was valued at USD 964.90 million in 2017 and continued to grow until 2021. This segment growth is due to the shift of the oil and gas business from land-based activities to locations such as deep water areas, away from end-users. The growing demand for liquid fuels is attributed to increasing demand from developing countries in Asia such as China and India. For example, Oil and Natural Gas Corporation (ONGC) Ltd. in India in February 2023 will invest approximately USD 2 billion over the next two to three years to conduct offshore exploration in 103 wells.
Production from the onshore oil and gas segment has increased owing to growing investments in unconventional exploration and production activities. For instance, the capital expenditure in the oil and gas industry in the US increased from USD 131.9 billion in 2018 to USD 144.1 billion in 2021. Therefore, the increase in fuel demand and a rise in offshore E and P activities are expected to drive the growth of the global offshore support vessel market in this segment during the forecast period.
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North America is estimated to contribute 53% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. North America dominated the focused regional market in 2022. It is expected to maintain its dominance during the forecast period. The region's shale revolution has caused oil prices to plummet, but a modest rise has led the region to resume deepwater and ultra-deepwater oil and gas projects in the Gulf of Mexico. This could encourage chartering of offshore supply vessels in the region.
In 2020, the COVID-19 pandemic negatively impacted the regional offshore support vessel market. However, in H2 2020, with the introduction of vaccines, the number of COVID-19 cases declined in the region, which led to the lifting of COVID-19-related restrictions. This also led to the resumption of operations on several delayed offshore oil and gas projects. The US Energy Information Administration (EIA) has estimated that oil production in the US Gulf of Mexico rose to 11.8 million barrels per day (b/d) in 2022. Thus, with an increase in oil production and the resumption of operations in offshore oilfields, the regional demand for offshore support vessels is expected to rebound during the forecast period. This is expected to drive the growth of the regional market in focus during the forecast period.
The offshore support vessel market report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027.
Technavio categorizes the global offshore support vessel market as a part of the global oil and gas exploration and production market within the global oil and gas market under the energy sector. The parent, global oil and gas exploration and production market, covers the companies engaged in the process of exploration and production (extraction) of crude oil and natural gas. Our market research report has extensively covered external factors influencing the parent market growth during the forecast period.
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Offshore Support Vessel Market Scope |
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Report Coverage |
Details |
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Page number |
174 |
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Base year |
2022 |
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Historic period |
2017-2021 |
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Forecast period |
2023-2027 |
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Growth momentum & CAGR |
Accelerate at a CAGR of 5.41% |
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Market growth 2023-2027 |
USD 525.58 million |
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Market structure |
Fragmented |
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YoY growth 2022-2023(%) |
5.08 |
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Regional analysis |
North America, Europe, APAC, Middle East and Africa, and South America |
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Performing market contribution |
North America at 53% |
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Key countries |
US, Canada, United Arab Emirates, China, and Germany |
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Competitive landscape |
Leading vendors, market positioning of vendors, competitive strategies, and industry risks |
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Key companies profiled |
AP Moller Maersk AS, BOURBON Corp, China National Offshore Oil Corp., COSCO Shipping Co. Ltd., Damen Shipyards Group, DP World, Eastern Shipbuilding Group Inc., Edison Chouest Offshore Co., Fincantieri Spa, Harvey Gulf International Marine LLC, Hornbeck Offshore Services Inc., John Swire and Sons Ltd., Kawasaki Kisen Kaisha Ltd., Nam Cheong Ltd., Reliance Naval and Engineering Ltd., Siem Offshore Inc., Singapore Technologies Engineering Ltd., Solstad Offshore ASA, Tidewater Inc., and Zamil Offshore Services Co. |
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Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast period. |
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Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements. Get in touch
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Application
7 Market Segmentation by Product
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
Research Framework
Technavio presents a detailed picture of the market by way of study, synthesis, and summation of data from multiple sources. The analysts have presented the various facets of the market with a particular focus on identifying the key industry influencers. The data thus presented is comprehensive, reliable, and the result of extensive research, both primary and secondary.
INFORMATION SOURCES
Primary sources
Secondary sources
DATA ANALYSIS
Data Synthesis
Data Validation
REPORT WRITING
Qualitative
Quantitative
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