Since the oil and gas downturn of 2014 there has been significant pressure on drilling service costs, including land rig day rates. One of the most significant costs on any onshore oilfield is the cost of hiring a rig to drill the well.
The key story of the last three months has been the rapid rise in oil and gas prices following Russia’s invasion of Ukraine. In December 2021, Brent oil prices averaged $74 a barrel, and by March 2022 they averaged $118, highlighting just how dramatic an impact the invasion had on global prices.
At the beginning of January 2022 Brent prices were at $78 a barrel, well above the nadir of 2020 when they reached a low of $9 a barrel. What has been seen since has been well outside of most forecasts, with Brent prices breaching $100 a barrel on the 24th of February 2022.
Demand for Land Rigs expected to be c. 30% higher in 2025, from the lows of 2020, driven primarily by China, GCC countries and Russia
Westwood’s tenth edition of the ‘World Land Drilling Rig Market Forecast’ report assesses impact following estimated worst year on record for drilling