April 22, 2024
Artificial Intelligence (AI) in Oil and Gas Market

Artificial Intelligence (AI) In Oil And Gas Market Poised For Significant Growth Owing To Increasing Demand For Data Analysis

The artificial intelligence (AI) in oil and gas market is estimated to witness high growth owing to increasing demand for data analysis. AI in oil and gas helps in optimizing operations, improving productivity, and reducing costs. It also assists in interpreting complex data sets generated from seismic surveys, drilling operations, production systems, and more. AI is extensively used in applications like drilling, production optimization, predictive maintenance, asset performance management, and supply chain management in oil and gas industry. The Global artificial intelligence (AI) in oil and gas market is estimated to be valued at US$ 2.99 BN in 2024 and is expected to exhibit a CAGR of 12.% over the forecast period from 2024 to 2031.

Key Takeaways

Key players operating in the artificial intelligence (AI) in oil and gas are Google, IBM, SAS, Accenture Plc., Baidu, Inc., H2O.ai., Microsoft Corporation, Oracle Corporation are the major players operating in artificial intelligence (AI) oil and gas market. Key players are focusing on developing smart and innovative AI solutions to help oil and gas companies optimize operations. Growing investments in digital technologies by oil and gas companies provide lucrative opportunities for key players in the market.

The key opportunities in the market include increasing adoption of AI solutions for predictive maintenance, optimization of field operations, and autonomous vehicles. AI helps reduce downtime, improve safety, optimize production, and save costs for oil and gas companies.

Global expansion of the Artificial Intelligence (AI) in Oil and Gas Market Demand is expected as organizations are increasingly adopting digital technologies across regions. North America currently dominates the market due to presence of major oil and gas companies and AI vendors. However, Asia Pacific is expected to witness fastest growth due to increasing investments to boost oil and gas production.

Market drivers

The major driver for the artificial intelligence (AI) in oil and gas market is the increasing demand for data analysis. Oil and gas companies generate huge amounts of data from diverse sources including seismic sensors, SCADA systems, smart devices etc. Analyzing this vast set of structured and unstructured data helps organizations gain valuable insights, optimize processes, increase productivity and reduce costs. AI has emerged as the ideal technology to help oil and gas industry effectively manage and interpret large data sets. This drives the increasing adoption of AI in oil and gas sector.

PEST Analysis

Political: The adoption of AI in oil and gas industry is positively impacted by the government initiatives undertaken towards leveraging emerging technologies. For instance, several governments offer direct funding and subsidies to promote digitalization and automation in this industry.

Economic: The fluctuating oil prices and need to optimize resources are driving oil and gas companies to invest in AI technologies to enhance productivity and reduce costs. AI helps in predictive maintenance and reducing non-productive time of equipment.

Social: With rising awareness, people expect oil and gas companies to minimize environmental footprint and ensure safety of operations. AI assists in remote monitoring of assets, predictive diagnostics, and early leak detection to improve safety and sustainability.

Technological: Advancements in deep learning, machine learning, and natural language processing have enabled the development of algorithms that can analyze vast amounts of data from sensors. This data-driven approach using AI aids in optimal decision making for production optimization, reservoir management, and risk assessment.

In terms of value, North America holds the largest share of the AI in oil and gas market currently due to high adoption of automation technologies among major oil companies based in the US and Canada. However, the Middle East and Africa region is witnessing the fastest growth attributed to ongoing digital transformation initiatives by national oil companies as well as rapidly increasing investments towards IoT infrastructure and AI applications.

Among the emerging regions, Asia Pacific provides immense opportunities for AI in oil and gas market propelled by rising energy demand from China and India along with significant exploration and production activities. Besides, the governments in countries like India are undertaking initiatives to boost investments in renewables, digital oil fields, and smart energy infrastructure using AI-enabled solutions.

*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it.