Market Overview
The Global Artificial Intelligence in Oil and Gas Market is expected to reach a value of
USD 6.2 billion in 2023, and it is further anticipated to reach a market value of
USD 21.0 billion by 2032 at a
CAGR of 14.5%.
Artificial Intelligence (AI) in the oil & gas industry includes using specific computer algorithms & ML to automate processes in the exploration, production, distribution, & management of oil and natural gas., which utilize large data, like geological & operational information, to provide insights, enhance decision-making, & optimize efficiency and safety in the industry.
Key Takeaways
- By Component, Software segment leads in 2023 & is anticipated to dominate throughout the forecasted period.
- Predictive Maintenance & Machinery Inspection segment as function is expected to have significant growth over the forecasted period.
- By Application, upstream takes the lead & drives the market in 2023.
- North America has a 40.2% share of revenue in the Global Artificial Intelligence in Oil and Gas Market in 2023
Market Dynamic
The oil & gas industry experiences significant challenges in identifying threading issues in pipes & equipment flaws prone to errors, often leading to costly damages & losses. Thus, integrating AI & computer-vision-based systems simplifies quality assessment, delivering detailed analytics on potential flaws. The industry contends with corrosion & deterioration of oil and gas components during storage and distribution, including pipeline integrity & threading conditions. To constantly address these issues, the adoption of AI solutions becomes critical, as technologies like AI & IoT, use algorithms with knowledge graphs & predictive intelligence, and can detect early signs of damage, enabling companies to schedule preventive maintenance & avert equipment failure-related downtime, which are expected to drive market growth in the oil and gas sector.
However, the implementation of AI technologies includes high upfront costs, creating challenges for smaller companies with fewer resources. Integrating AI with existing systems may be complex, causing compatibility issues & the need for customized solutions., which are anticipated to be major challenges hindering market growth.
Research Scope and Analysis
By Component
In terms of components, the global
artificial intelligence in the oil & gas market is categorized into software, hardware, and services. The software segment dominated in 2023, which is likely to persist in the coming future, as it serves as the foundation for the AI applications in the industry, supporting the processing, analysis, & extraction of insights from vast datasets.
Highly used platforms like TensorFlow, PyTorch, & sci-kit-learn play a vital role in developing & deploying ML models for tasks like equipment maintenance, reservoir prediction, & demand forecasting. Further, predictive maintenance software, represented by solutions like IBM Maximo & GE Digital Predix APM, includes AI to monitor equipment conditions & forecast maintenance needs, thereby driving the growth of the software segment throughout the forecast period.
By Function
Predictive maintenance & machinery inspection claimed the largest market share establishing their dominance in 2023. These solutions play a vital role in minimizing downtime by analyzing equipment data & forecasting potential failures, thereby preventing disruptions, which lies in identifying wear & tear or other forms of deterioration that, if left unattended, could create safety hazards.
Proactively pinpointing potential issues enables companies to replace or repair components as needed, highly supporting complete operational safety, which is further driven by developments in sensor technology & the Internet of Things (IoT), enhancing the strength & accuracy of data collection, which makes predictive maintenance & machinery inspection more reliable & effective, contributing positively to market growth. Moreover, these solutions offer a convincing return on investment (ROI) by reducing maintenance costs, enhancing operational efficiency, & strengthening security protocols.
By Application
The global artificial intelligence in the oil & gas market is categorized by application including upstream, midstream, and downstream segments. Among these, the upstream segment holds the biggest market share in 2023, & this trend is expected to persist during the forecasted period. AI is playing a vital role in transforming the upstream sector, including exploration, drilling, & production activities within the oil & gas industry.
Further, many AI technologies are deployed to optimize operations, improving efficiency in upstream processes, which includes AI algorithms analyzing seismic data for more precise identification of potential hydrocarbon reserves &
machine learning ML models predicting subsurface structures with better precision. Furthermore, AI systems process live data from drilling operations, optimizing parameters, detecting anomalies, & making quick adjustments to enhance drilling efficiency & less downtime.
The Artificial Intelligence in Oil and Gas Market Report is segmented on the basis of the following
By Component
- Software
- Hardware
- Services
By Function
- Predictive Maintenance & Machinery Inspection
- Material Movement
- Production Planning
- Field Services
- Quality Control
- Reclamation
By Application
- Upstream
- Midstream
- Downstream
Regional Analysis
North America dominated the AI in the oil and gas market in 2023,
holding a significant 40.2% market share, which is due to the well-established infrastructure for oil & gas extraction and advanced AI technology in the region, facilitating smooth adoption by companies. Further high investments in research & innovation by both regional governments & private entities contribute to current development in AI implementation within the oil & gas sector, promoting market growth.
Also, North American companies, with a mature awareness of data analytics, create a favorable environment for embracing & optimizing AI capabilities across different sectors, like oil & gas. In addition, the region benefits from an abundant pool of skilled professionals in data sciences & AI algorithms, further supporting the broad implementation of advanced technologies.
Meanwhile, the Asia Pacific region is anticipated to experience the highest growth over the forecasted period, which is driven by increased oil and gas exploration & production activities, along with a rising wave of digitalization initiatives. Also, firms in the Asia Pacific oil & gas sector are strategically deploying AI solutions to convert data into actionable insights, streamline operations, and enhance overall efficiency, fostering significant market expansion in the region.
By Region
North America
Europe
- Germany
- The U.K.
- France
- Italy
- Russia
- Spain
- Benelux
- Nordic
- Rest of Europe
Asia-Pacific
- China
- Japan
- South Korea
- India
- ANZ
- ASEAN
- Rest of Asia-Pacific
Latin America
- Brazil
- Mexico
- Argentina
- Colombia
- Rest of Latin America
Middle East & Africa
- Saudi Arabia
- UAE
- South Africa
- Israel
- Egypt
- Rest of MEA
Competitive Landscape
The AI in the oil & gas market experiences moderate competition with a few key players dominating market share. Both existing & new companies are constantly expanding their business portfolios with AI technology. Also, players consistently prioritize strategic investments to expand, complement, & enhance their product and service offerings, which includes acquiring new customers, certified personnel, and extending sales channels to support growth in the market.
In January 2023, C3.AI Inc. introduced the C3
Generative AI product suite, designed to enhance transformation initiatives across different sectors, mainly in industries like oil and gas, as it aims to facilitate & accelerate the evolution of businesses by supporting generative artificial intelligence, offering a powerful toolset for enhancing efficiency & performance in diverse sectors.
Some of the prominent players in the global Artificial Intelligence in Oil and Gas Market are
- C3.AI
- Google LLC
- Microsoft Corp
- IBM Corp
- NVIDIA Corp
- FuGenX Technologies Pvt Ltd
- Royal Dutch Shell PLC
- Cisco System
- Huawei Technologies
- Infosys Ltd
- Other Key Players
COVID-19 Pandemic & Recession: Impact on the Global Artificial Intelligence in Oil and Gas Market:
The COVID-19 pandemic & following economic recession have highly impacted the global artificial intelligence in the oil & gas market, as disruptions in supply chains, project delays, & minimal investments due to uncertainties caused by the pandemic. Companies in the oil & gas sector had to evaluate priorities, leading to a halt in the adoption of AI technologies. The economic downturn caused cost-cutting measures, impacting budget allocations for AI integration.
However, the crisis also showcased the importance of resilience & effectiveness, driving a renewed interest in AI solutions for streamlining operations & enhancing decision-making. As the industry steadily recovers, there is an increasing awareness that AI can play a vital role in reducing future challenges, but the market's growth is influenced by the ongoing economic recovery & the industry's ability to adapt to the evolving landscape.
Recent Development
- In September 2023, INEOS Energy & SLB unveiled a collaboration in subsurface technology, focusing on enhancing operational efficiency for future growth. As part of the agreement, INEOS Energy will integrate SLB's Delfi digital platform across its subsurface operations, strengthening enhanced performance & innovation in the pursuit of expanded capabilities.
- In May 2023, Shell Plc announced a partnership with SparkCognition, a big data analytics company, to enhance its deep-sea exploration & production capabilities, using SparkCognition's AI-based technology, Shell focuses on to increase offshore oil output, which includes installation of SparkCognition's AI algorithms to analyze extensive seismic data, assisting Shell's efforts to identify and explore new oil reservoirs in an efficient and technologically advanced manner.
- In March 2022, NVIDIA launched an advancement to its AI platform, introducing the AI Accelerated program, which is designed to advance various workloads, like recommender systems, speech processing, & hyper-scale belief systems. Acting as a comprehensive toolbox, NVIDIA AI assists the global AI community, catering to AI data scientists, researchers, & the many sections involved in data & ML procedures.
Report Details
| Report Characteristics |
| Market Size (2023) |
USD 6.2 Bn |
| Forecast Value (2032) |
USD 21.0 Bn |
| CAGR (2023-2032) |
14.5% |
| Historical Data |
2017 - 2022 |
| Forecast Data |
2023 - 2032 |
| Base Year |
2022 |
| Estimate Year |
2023 |
| Report Coverage |
Market Revenue Estimation, Market Dynamics, Competitive Landscape, Growth Factors and etc. |
| Segments Covered |
By Component (Software, Hardware, and Services),
By Function (Predictive Maintenance, Machinery
Inspection, Material Movement, Production Planning,
Field Services, Quality Control, Reclamation), By
Application (Upstream, Midstream, and Downstream) |
| Regional Coverage |
North America – The US and Canada; Europe – Germany, The UK, France, Russia, Spain, Italy, Benelux, Nordic, & Rest of Europe; Asia- Pacific– China, Japan, South Korea, India, ANZ, ASEAN, Rest of APAC; Latin America – Brazil, Mexico, Argentina, Colombia, Rest of Latin America; Middle East & Africa – Saudi Arabia, UAE, South Africa, Turkey, Egypt, Israel, & Rest of MEA
|
| Prominent Players |
C3.AI, Google LLC, Microsoft Corp, IBM Corp, NVIDIA
Corp, FuGenX Technologies Pvt Ltd, Royal Dutch Shell
PLC, Cisco System, Huawei Technologies, Infosys Ltd,
and Other Key Players |
| Purchase Options |
We have three licenses to opt for: Single User License (Limited to 1 user), Multi-User License (Up to 5 Users), and Corporate Use License (Unlimited User) along with free report customization equivalent to 0 analyst working days, 3 analysts working days and 5 analysts working days respectively. |
Frequently Asked Questions
The Global Artificial Intelligence in Oil and Gas Market size is estimated to have a value of USD 6.2 billion
in 2023 and is expected to reach USD 21.0 billion by the end of 2032.
North America has the largest market share for the Global Artificial Intelligence in Oil and Gas Market
with a share of about 40.2% in 2023.
Some of the major key players in the Global Artificial Intelligence in Oil and Gas Market are C3.AI,
Google LLC, Microsoft Corp, and many others.
The market is growing at a CAGR of 14.5 percent over the forecasted period.