Drilling Rig Market Outlook:
Drilling Rig Market size was estimated at USD 45.9 billion in 2024 and is expected to surpass USD 74.7 billion by the end of 2037, rising at a CAGR of 3.8% during the forecast period, i.e., 2025-2037. In 2025, the industry size of drilling rig is evaluated at USD 47.8 billion.
The primary growth factor for the drilling rig market is growing upstream exploration and production activity. Given that the U.S. Energy Information Administration (EIA) reports an increase in the number of active rotary rigs and total footage drilled, there has been heightened drilling activity occurring in both crude oil and natural gas. It is important to note that drilling costs per well continue to increase in all direct drilling components, including labor, fuel, and equipment costs. There is also evidence of increased drilling activity occurring within each facet of oil and gas exploration and production upstream industry level, as shown by the fact that as of May 2025, the oil and gas extraction workforce was roughly 122.9K, up from 122.4K in February (BLS).
While the Bureau of Labor Statistics (BLS) data identifies inflationary pressures, also important to highlight the significant increases in the Producer Price Index (PPI) and the Consumer Price Index (CPI) for petroleum equipment (indexing 38 percent and a whopping 358 percent, respectively). On the supply side, U.S. imports of metals and minerals jumped from $204 billion to $261 billion in 2021, with imports of steel mill products nearly doubling. Supply of materials and components to the rig and rig equipment markets is increasing from historical lows. In addition, growing levels of steel exports ($3.6 billion) and increases in overall imports of industrial goods ($346.8 billion in March 2025) are positive indicators for increased manufacturing and ability for global deployability.
Drilling Rig Market - Growth Drivers and Challenges
Growth Drivers
- Rising oil and gas exploration activities: The offshore rig count surged 18% YoY to 300+ in 2024, led by the Gulf of Mexico and North Sea, where projects like Equinor’s Johan Sverdrup Phase 3 demand high-spec rigs. Shale revival in the U.S. has pushed land rig counts to 620+ (June 2024), with the Permian Basin alone adding 50 rigs this year (EIA). Further, emerging frontiers like Namibia’s Venus discovery and Guyana’s Stabroek Block are attracting $42B in deepwater investments, requiring advanced ultra-deepwater rigs. This demand has propelled the global drilling rig market, with day rates for premium rigs jumping 25% in 2024.
- Energy transition and geothermal expansion: Geothermal drilling activity surged 50% YoY in 2024 (IEA), with projects like Japan’s 50MW Tohoku plant and the EU’s 100+ wells requiring high-temperature rigs. The global CCS market, projected to reach $7B by 2030, demands specialized rigs for COâ‚‚ injection wells, with $ 70B+ invested worldwide. Hybrid/electric rigs now account for 25% of new deployments, reducing emissions by 30% per well. Geothermal rig contracts jumped 40% in 2023–24, led by Indonesia and the U.S. The sector’s growth aligns with $2T global energy transition investments, positioning geothermal and CCS as key rig demand drivers.
1. Drilling Rig Market: Historical Trends & Price Analysis
Market Overview (2019-2023)
|
Year |
Global Unit Sales |
Avg. Price (USD Million/Rig) |
NA Price Trend |
Europe Price Trend |
Asia Price Trend |
|
2019 |
1,251 |
18.6 |
+3% |
-4% |
+7% |
|
2020 |
981 (-21.7%) |
16.9 (-9.1%) |
-11% |
-14% |
-9% |
|
2021 |
1,181 (+20.5%) |
19.3 (+14.4%) |
+19% |
+11% |
+23% |
|
2022 |
1,351 (+14.5%) |
21.7 (+12.6%) |
+26% |
+31% |
+16% |
|
2023 |
1,421 (+5.23%) |
23.2 (+6.8%) |
+9% |
+6% |
+13% |
Price Influencers & Statistical Impact
Raw Material Costs
|
Material |
Price Change (2019-2023) |
Rig Cost Impact |
|
Steel |
+43% (2021 peak) |
+16% (2021) |
|
Copper |
+29% (2022 shortage) |
+10% (2022) |
Geopolitical Events
|
Event |
Regional Impact |
Price Effect |
|
Russia-Ukraine War |
EU rig imports fell 36% |
+31% (Europe) |
|
U.S. Shale Boom |
NA rig demand up 41% |
+26% (2022) |
Environmental Regulations
|
Policy |
Compliance Cost/Rig (USD Million) |
Market Impact |
|
EPA Emissions Rules |
+0.46 |
+8% (NA) |
|
EU Carbon Tax |
+0.61 |
+13% (Europe) |
Future Outlook (2024-2026)
|
Factor |
Projected Impact |
|
Deepwater Drilling |
+19% Annual Demand |
|
Asia LNG Expansion |
+26% Rig Orders (2024) |
|
Automation Adoption |
31% Market Share by 2026 |
2. Demand Analysis of the Drilling Rig
Global Drilling Rig Market Trends (2014–2024)
|
Sector |
Data & Trend |
|
Oil & Gas Segment |
Accounts for 71% of demand; U.S. rig count ~588, down 7% YoY in 2023. |
|
Mining Sector |
Rotary rigs for mineral exploration: USD 2.8 B (2024) → USD 4.1 B by 2033 (3.5% CAGR). |
|
Construction & Geothermal |
Geothermal rigs: USD 157 M (2023) → USD 215 M by 2030 (4.7% CAGR). |
|
Floating Rigs (Offshore) |
Floating rigs: USD 28.8 B (2023) → USD 47.7 B by 2033 at 5.3% CAGR. |
|
Electric/Hybrid Rigs |
Electric rigs: USD 1.6 B (2023) → USD 3.9 B by 2032 (11.3% CAGR). |
|
AI & IoT Technology Adoption |
Predictive systems lead to 11–16% OPEX savings, load efficiency up 56–81%. |
|
Pressure |
Impact |
|
Bio-based/Electric Rigs |
Emission reduction; electric rigs growing from USD 1.6B to 3.9 B (11.3% CAGR). |
|
Recyclable Materials |
Steel cost up 13% (2021); recycled alloys reduce costs. |
|
Tech Integration (IoT/AI) |
Predictive maintenance saves 11–16% OPEX; efficiency up 56–81%. |
Challenges
- Stringent environmental regulations increase operational costs: Worldwide, governments continue to implement stronger environmental legislation with significant costs of compliance. For example, in the U.S., the EPA's revised National Emission Standards for Hazardous Air Pollutants (NESHAP) in 2023 added 18% to the cost of emissions controls for drilling rig suppliers, particularly challenging for small- and mid-sized manufacturers. The compliance effort relied on the purchase and installation of improved filtration systems and leak testing systems. Helmerich & Payne Inc. announced an investment of $32 million to upgrade emissions-control systems to comply with the 2023 EPA standards. The burden upon suppliers makes new market entrants undesirable, not to mention that costs stymie innovation.
- High pricing pressures and margin compression: In addition to the above costs, drilling rig suppliers are dealing with contracting prices due to wild fluctuations in crude prices, expensive steel input prices, and large volumes of crude supply from around the world. Average duties on imports of drilling components are still at levels near 7-12% in important developing markets like India and Indonesia, according to the World Trade Organization (WTO), and this adds even more to the cost of total deployment. For example, National Oilwell Varco (NOV) announced an upward price reduction of 8-10% on rig prices across Asia-Pacific, down from 2018, to remain competitive with upstream peers. Profit margins suffer in these competitive conditions.
Drilling Rig Market Size and Forecast:
| Report Attribute | Details |
|---|---|
|
Base Year |
2024 |
|
Forecast Year |
2025-2037 |
|
CAGR |
3.8% |
|
Base Year Market Size (2024) |
USD 45.9 billion |
|
Forecast Year Market Size (2037) |
USD 74.7 billion |
|
Regional Scope |
|
Drilling Rig Market Segmentation:
Application Segment Analysis
The oil and gas extraction segment is predicted to gain the largest drilling rig market share of 60.2% during the projected period by 2037, due to increased energy consumption, especially in developing nations. Hydraulic fracturing and extended-reach drilling techniques have enabled the hydrocarbon industry to exploit these unconventional reserves, and the shale boom, along with deep water investigations, has driven up overall revenues. The shift in public policy, stressing energy security, has fortified capital investments, which allows this part of the market to continue to dominate.
Type Segment Analysis
The offshore drilling rig segment is anticipated to constitute the most significant growth by 2037, with 45.3% drilling rig market share, mainly as reserves are declining on land, which is forcing expeditions into deeper regions. Government incentives and regulatory support for offshore projects are fueling the nobility in the offshore sector. The Offshore areas of the Gulf of Mexico and the Northeast Sea are the busiest. Consequently, the advancement of new rig technologies, such as dynamically positioned drill ships, is enhancing efficiency, which is maintaining high revenue shares from the market for offshore production in oil and gas production.
Our in-depth analysis of the drilling rig market includes the following segments:
|
Segment |
SubSegment |
|
Application |
|
|
Type |
|
|
Depth |
|
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Drilling Rig Market - Regional Analysis
Asia Pacific Market Insights
By 2037, the Asia Pacific drilling rig market is expected to hold 33.2% of the market share due to offshore investments and accounting for 85.2% of deepwater spend, and rising demand for jack-up rigs. Trends are rapidly changing, driven by digitalization, IoT, and automation. Environmental pressures and sustainability goals combined with the energy demand and government-supported projects, along with the ongoing potential for new offshore blocks, will drive APAC to become the second developer of drilling rigs by 2037.
China will lead APAC drilling rig revenues by 2037, as they have the highest energy demand (15.1 million barrels/day, 379 bcm gas), and significant state investment in energy sectors. Policy by China’s National Development and Reform Commission (NDRC) and the Ministry of Ecology, green-light offshore projects and shale gas development, and promote tech-led clean energy supply and modernization of energy assets. China National Offshore Oil Corporation’s (CNOOC) deepwater expansion and aggressive sustainable drilling initiatives support China’s leadership role in drilling rig supply.
Malaysia is driven by offshore government-sponsored projects and deepwater awards. Malaysia's drilling rig market is gaining momentum, on the back of the R&D tax incentive from the Ministry of Science, Technology and Innovation (MOSTI). MOSTI’s R&D tax incentive and projects around drilling chemicals are forecasted to create downstream R&D jobs. Malaysia's upstream campaign of automation, predictive maintenance, and sustainability strategies is gathering momentum, and now that statistical energy planning modelling has been heralded together with the government's desire for new upstream sustainability.
Country-Wise Key Developments in Drilling Rigs
|
Country |
Key Developments (2023–2024) |
|
Japan |
16% of R&D to GaAs wafer & drill-chem ($1.3 bn); 150 firms using clean processes. |
|
China |
Drill-chem spending ↑31% (2018–23); 1.3M+ firms adopted sustainable processes. |
|
India |
GaAs tech funding ↑26% (2015–23) to $0.9 bn/year; 2.1M firms use green chemicals. |
|
Malaysia |
Firms using drill-tech doubled (2013–23); green chem funding ↑41%. |
|
South Korea |
Green chem investment ↑36%; 500+ firms using sustainable solutions. |
|
Australia |
4 deepwater projects since 2022; AUD $201 m in chem R&D. |
|
Indonesia |
120 firms adopted drill-tech (↑51% since 2018); enviro fund ↑31%. |
|
Taiwan |
$0.6 bn for GaAs chemicals; 200 firms using advanced drill-chem. |
|
Thailand |
61% of chem firms use drill-tech; 26% funding rise (2022–23). |
|
Singapore |
S$151 m for green chemical initiatives; 81% firms use clean tech. |
|
Philippines |
50 SMEs trained in safe & clean drill-chem practices. |
|
Vietnam |
Enviro chemical budget ↑31%; 300 firms using best practices. |
|
New Zealand |
NZ$101 m green fund; 71% of producers use sustainable drill-chem. |
North America Market Insights
North America will contain 28.5% of the world drilling rig market growth at a CAGR of 4.8%. Government directives also support the growth of the chemical, energy, and manufacturing sectors by providing federal funding resources, green mandates, and safety regulations. There has been a significant increase in smart rig utilization and automation for rigs. Government personnel, like the Department of Energy (DOE), Environmental Protection Agency (EPA), and the American Chemistry Council (ACC), are looking to promote advanced drilling technologies that are clean, efficient, and focus on delivering safe drilling systems.
The U.S. drilling rig market is expanding at a 5.8% CAGR (2024–2030), fueled by surging shale activity and energy security priorities. The Permian Basin alone hosts 340+ active rigs (June 2024), driving 45% of domestic oil output (EIA), while the Haynesville Shale adds 20% more rigs YoY to meet LNG export demand. Government policies like the Inflation Reduction Act inject $6B in tax credits for advanced drilling tech, boosting adoption of automated rigs (now 30% of the fleet, up from 15% in 2020). Offshore, the Gulf of Mexico’s $11B projects (e.g., Shell’s Whale) require high-spec rigs, with day rates up 25% since 2023.
The Canadian drilling rig market is projected to grow at a 4.7% CAGR (2024–2030), driven by renewed oil sands investments and LNG expansion. Alberta’s oil sands account for 65% of active rigs, with SAGD operations requiring specialized rigs for 500+ wells annually (CAPP, 2024). The $40B LNG Canada project has boosted demand for directional drilling rigs, with a 25% increase in British Columbia deployments. Government incentives like the Canada Growth Fund allocate $10B for low-emission drilling tech, accelerating adoption of electric/hybrid rigs (15% of fleet, up from 5% in 2020).
Europe Market Insights
The European drilling rig market is expected to hold 22.4% of the market share, supported by energy security demands and decarbonization efforts. Offshore wind projects like the UK’s Dogger Bank (3.6GW, $1.4B investment) and Norway’s Johan Sverdrup Phase 3 ($4.5B) require specialized rigs, boosting demand by 25% YoY. Geothermal expansion in Germany (50+ wells by 2025) and CCS initiatives like the Netherlands’ Porthos project ($2.3B) further propel rig deployments, with 40% of new contracts now tied to low-carbon projects (IEA). Further, government policies, including the EU’s $800M North Sea Transition Deal, incentivize advanced rig adoption, while automation cuts costs by $300K/well.
Country-Wise Market Overview & Advanced Technologies
|
Country |
Active Rigs (2024) |
CAGR (2024-2030) |
Advanced Technologies |
Key Players |
|
Norway |
45 |
6.5% |
- Electric rigs (50% emissions cut) |
Equinor, Aker BP, Odfjell Drilling |
|
UK |
32 |
5.8% |
- AI-driven predictive maintenance (BP) |
BP, Harbour Energy, Transocean |
|
Germany |
18 |
7.2% |
- Geothermal rigs (400°C capable) |
Wintershall Dea, Siemens Energy |
|
Netherlands |
12 |
6.0% |
- CCS-compatible rigs (Shell) |
Shell, Noble Corporation |
|
Italy |
10 |
4.5% |
- Robotic well intervention (Eni) |
Eni, Saipem |
Key Drilling Rig Market Players:
- Company Overview
- Business Strategy
- Key Product Offerings
- Financial Performance
- Key Performance Indicators
- Risk Analysis
- Recent Development
- Regional Presence
- SWOT Analysis
Key players are driving the drilling rig market through technological innovation, strategic investments, and expansion into high-growth sectors. SLB and Halliburton dominate with AI-powered rigs, reducing downtime by 30% and cutting costs by $500K/well. Transocean and Noble Corporation are expanding ultra-deepwater fleets, securing $4B in offshore contracts (Brazil, Guyana) with rigs rated for 3,000 m+ depths. Equinor and BP are leading the energy transition, deploying hybrid/electric rigs (20% of new orders) for projects like Dogger Bank Wind Farm and Johan Sverdrup Phase 3. Meanwhile, NOV and Siemens Energy are advancing automation, with robotic rig systems improving efficiency by 25% (IEA). Collectively, these players are propelling the drilling rig market while addressing ESG goals through $70B in low-carbon R&D (2023–2026).
Some of the key players operating in the market are listed below:
|
Company Name |
Country of Origin |
Estimated Market Share (%) |
|
Nabors Industries Ltd. |
USA |
10.6% |
|
Helmerich & Payne, Inc. |
USA |
9.9% |
|
Schlumberger Limited |
USA |
8.8% |
|
National Oilwell Varco, Inc. (NOV) |
USA |
8.3% |
|
Japan Drilling Co., Ltd. (JDC) |
Japan |
4.3% |
|
KCA Deutag |
UK |
xx% |
|
Weatherford International plc |
USA |
xx% |
|
Saipem S.p.A. |
Italy |
xx% |
|
Halliburton Company |
USA |
xx% |
|
Borr Drilling Limited |
Norway |
xx% |
|
Drillmec S.p.A. |
Italy |
xx% |
|
Jindal Drilling & Industries Ltd. |
India |
xx% |
|
POSCO International Corporation |
South Korea |
xx% |
Here are a few areas of focus covered in the competitive landscape of the drilling rig market:
Recent Developments
- In April 2024, Noble Corporation announced that its Noble Innovator rig securing a $600M UK North Sea contract with Shell highlights a leap in automated drilling technology. The rig’s advanced automation systems reduce crew requirements by 30%, lowering operational costs while maintaining precision in Shell’s Penguins Field redevelopment. Its upgraded emissions control technology slashes methane emissions by 50% compared to legacy rigs, aligning with stricter North Sea environmental regulations.
- In May 2024, Valaris announced a $1.1B ultra-deepwater contract for its VALARIS DS-16 rig with Petrobras, marking a major milestone for Brazil’s Búzios Field, one of the world’s largest offshore reserves. The rig’s hybrid power system delivers 20% greater fuel efficiency, reducing operational costs and emissions. A pioneering feature, its real-time carbon monitoring system, sets a new industry standard for sustainability in deepwater drilling. The 4-year contract reinforces Valaris’s leadership in high-efficiency rigs and supports Petrobras’s target to boost pre-salt production. Deployment begins in 2025, with the potential to extend to other Latin American projects.
- Report ID: 4976
- Published Date: Jun 26, 2025
- Report Format: PDF, PPT
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