Artificial Intelligence in Oil and Gas Market Trends, Size, Share & Forecast

Artificial intelligence, through machine learning techniques, has enabled oil and gas companies to analyze massive amounts of operational data generated from disparate sources. AI helps process seismic data faster and more accurately to identify potential oil and gas reserves. It also optimize production processes, reduce costs, improve safety and environmental protection.

The Artificial Intelligence (AI) in Oil and Gas market is estimated to be valued at US$ 15.7 Mn in 2024 and is expected to exhibit a CAGR of 35% over the forecast period 2024 to 2031.

The Global Artificial Intelligence (AI) in Oil and Gas Market Demand is projected to grow exponentially during the forecast period owing to various factors such as increasing focus on operational efficiency of oil and gas assets and growing need for reduction of non-productive time. Additionally, increasing data volumes from oil and gas operations and rising digital transformation among oil and gas companies further supplements the market growth.

Key players operating in the Artificial Intelligence (AI) in Oil and Gas are ProQR Therapeutics, Editas Medicine, Nanoscope Therapeutics, Inc., jCyte, Inc., Biogen, Novartis AG, Spark Therapeutics, MeiraGTx, NightstaRx, Beacon Therapeutics, Applied Genetic Technologies Corporation, ViGeneron and RetinAI Medical.

Key Takeaways
Key players: ProQR Therapeutics, Editas Medicine, Nanoscope Therapeutics, Inc., jCyte, Inc., Biogen, Novartis AG, Spark Therapeutics, MeiraGTx, NightstaRx, Beacon Therapeutics, Applied Genetic Technologies Corporation, ViGeneron and RetinAI Medical are leveraging AI technology for exploration of oilfields, production optimization, preventive maintenance, and digital transformation.

Growing demand: Increasing focus on leveraging big data, IIoT, and AI by oil and gas operators to optimize operations and enhance productivity is fueling the demand for AI in oil and gas market. Additionally, growing focus on digital transformation of upstream, midstream, and downstream operations further supplements the market growth.

Global expansion: Key AI solution providers are expanding globally driven by increasing exploration and production activities in regions such as Asia Pacific, Middle East, and Africa. Additionally, growing awareness regarding AI benefits is compelling national oil companies to adopt AI solutions.

Market Key Trends
One of the key trends in the Artificial Intelligence In Oil And Gas Companies is the increasing adoption of predictive maintenance solutions. AI-powered sensors are helping operators analyze vibration, temperature and other operational parameters of oil & gas assets to predict mechanical failures and schedule maintenance accordingly. This helps avoid unexpected breakdowns and improves asset uptime significantly. Data collected from diverse IoT devices is feeding AI models to enable more accurate prediction compared to conventional techniques.

Porter's Analysis
Threat of new entrants: Low setup and operational costs for AI software companies to enter. However, requirements for domain expertise and specialized technical skills pose challenges for new companies.

Bargaining power of buyers: Oil and gas companies hold high bargaining power given the consolidating nature of industry. High switching costs also allow buyers to negotiate on price and demand additional services.

Bargaining power of suppliers: Key AI technology suppliers like IBM, Microsoft, Intel, Nvidia have considerable power as limited alternatives exist. Suppliers can charge premium prices for their specialized solutions.

Threat of new substitutes: No direct substitutes currently exist for AI in optimizing exploration, production, and refining activities. Alternative energy sources like renewable energy are indirect substitutes.

Competitive rivalry: Intense rivalry exists among AI vendors given the attractive market opportunities. Companies compete on technologies, customer experience, and total cost of ownership for long-term contracts.

Geographical Regions
North America accounts for the largest share in terms of value led by the United States. This is due to substantial investments by oil majors in AI-driven digital transformation efforts to minimize costs.

Asia Pacific is projected to grow at the fastest pace during the forecast period. Considerable in-house AI development activities by Chinese oil companies and growing exploration & production expenditure in countries like India support the regional market.