AI In Oil And Gas Market Size (2024 - 2029)

AI In Oil And Gas Market Analysis

The AI In Oil And Gas Market size is estimated at USD 3.14 billion in 2024, and is expected to reach USD 5.70 billion by 2029, growing at a CAGR of 12.61% during the forecast period (2024-2029).

The oil and gas industry is witnessing a surge in AI applications, spanning reservoir analysis and drilling optimization to safety monitoring and emissions reduction. This AI wave is set to reshape exploration, production, and environmental sustainability, propelling market growth.

Artificial intelligence, particularly in the form of predictive maintenance, is reshaping asset management in the oil and gas industry. This trend is poised to be a key driver of market growth by bolstering reliability and mitigating operational risks.

In October 2023, C3 AI, a leading Enterprise AI software firm, announced a collaboration with Shell, integrating predictive maintenance software into the C3 AI reliability application. This strategic partnership underscored the increased adoption of AI platforms in the oil and gas industry, underpinning market expansion.

AI technologies promise heightened operational efficiency in oil and gas, enabling companies to identify patterns, automate decisions, and analyze vast datasets from sensors and machinery. Equipped with AI, predictive maintenance solutions can preempt equipment breakdowns, allowing businesses to plan maintenance, minimize downtime, and optimize asset utilization.

The market is primarily driven by the oil and gas industry's need to lower production costs. Faced with volatile oil prices, companies are turning to AI to streamline operations, enhance efficiency, and cut costs.

As AI adoption accelerates, especially in the oil and gas industry, companies are leveraging its capabilities to extract deeper insights from their data. By optimizing their operations, these firms are not only cutting costs but also boosting productivity.

Russia faced an energy crisis following the 80 billion cubic meters (BCM) cut in pipeline gas supplies to Europe after its Ukraine invasion. This, in turn, hampered the operations of midstream and downstream players in the oil and gas industry, stalling market growth.

The European Union's push for energy self-sufficiency through renewable sources poses a challenge to the traditional oil and gas industry. This shift indirectly curtails the scope for AI solutions in the region's oil and gas industry, impacting market growth.

The global oil and gas industry, already navigating market dynamics, faced a severe setback during the COVID-19 pandemic. The ensuing global shutdown and reduced economic activities led to a significant drop in oil demand, plummeting international crude oil prices. Consequently, production and exploration activities in the industry were hampered, affecting the adoption of AI technologies.

AI In Oil And Gas Industry Segmentation

The oil and gas industry is increasingly turning to artificial intelligence (AI) as a cost-saving measure. AI applications, ranging from boiler diagnostics to drilling operations, are becoming integral in optimizing processes across the industry's upstream, midstream, and downstream segments. In the exploration and production areas, AI is leveraged for tasks like quality control, predictive maintenance, and planning. The report also delves into AI services, encompassing both professional and managed services.

This study evaluates the revenue generated by AI solutions from various industry players. The report not only scrutinizes market size but also delves into key parameters, growth drivers, and major vendors, all crucial for estimating market trends and growth rates during the forecast period.

The AI in oil and gas market is segmented by operation (upstream, midstream, and downstream), type (platform and services), and geography (North America, Europe, Asia-Pacific, Latin America, and Middle East and Africa). The market sizes and forecasts are provided in value terms (USD) for all the above segments.