Oil & Gas Producers
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 4,600 oil and gas producers in the US sell crude petroleum and natural gas from on-shore and off-shore wells to refineries, energy brokers, and other energy companies. Industry revenue is about evenly split between crude petroleum and natural gas.
Oil and Gas Price Volatility
Large declines in oil and gas prices have repercussions for producers.
Tapping Domestic Shale Deposits
The costs and hazards of transporting natural gas over long distances by ship dictate that the US’s primary sources of natural gas be domestic.
Industry size & Structure
A typical oil and gas producer operates from a single location and has annual revenues of $50 million.
- There are about 4,600 oil and gas exploration and production firms in the US that employ 117,000 workers and generate $230 billion in annual revenue.
- 81% of firms have fewer than 10 employees and just 4% have more than 100 employees.
- Large exploration and production firms include: Exxon Mobil (Integrated), Chevron (Integrated), Apache Corporation, Occidental Petroleum, Devon Energy, and Range Resources.
- Entry into the business is difficult, as exploration is expensive and a proven track record is essential in attracting capital.
- In addition, the competition for high-quality drilling and services is intense, and preference is given to partners with good prior experiences.
Industry Forecast
Oil & Gas Producers Industry Growth
Recent Developments
Jun 27, 2024 - Wages Hit New High
- According to the latest US Bureau of Labor Statistics data, the producer price index for oil and gas extraction firms rose 2.8% in April compared to a year ago after plunging nearly 35% in the previous annual comparison. The uptick in pricing power followed declines in total crude oil production and natural gas withdrawals in February compared to the previous month, although both were up significantly year over year (YoY), per the US Energy Information Administration. Average industry wages rose 3% year over year in April to a new high of $44.66 per hour, while employment by the industry grew 2.2% in May YoY, BLS data show.
- Oil and gas production companies are expanding offshore drilling operations in the Gulf of Mexico in part because doing so releases fewer greenhouse gases than drilling on land, The New York Times reports. Industry executives are betting on sustained demand for oil and gas for years to come and argue that offshore drilling is better for the climate than drilling on land because offshore operations emit far less greenhouse gases than producing the same amount of oil and gas on land, according to NYT. The greenhouse gas emissions associated with extracting a barrel of oil from the Gulf of Mexico are as much as a third lower than emissions from producing a barrel of oil from fields on US soil, according to a report published last year by the National Ocean Industries Association, an industry group for offshore oil, gas, and wind businesses, cited by NYT.
- Forecasts for an “extremely active” Atlantic hurricane season could threaten offshore oil and natural gas production in the Gulf of Mexico, according to a new report from researchers at Colorado State University (CSU). The CSU report, released in April, forecasts 23 named storms, including 11 hurricanes — five of them potentially reaching major status, meaning Category 3 or higher. In a typical season, there are 14 named storms with seven hurricanes, three of them major. The CSU team said that warm ocean waters serve as the fuel source for hurricanes. The CSU forecast follows a report released in March by US meteorology firm AccuWeather that also predicted an active hurricane season. NOAA will issue its first seasonal hurricane report in late May. Even the threat of a major storm can disrupt oil and natural gas production because companies must evacuate US Gulf platforms as a precaution.
- US retail gasoline prices will average about $3.60 per gallon in 2024 and 2025 (up 10 cents from 2023), according to the US Energy Information Administration’s April 2024 Short-Term Energy Outlook (STEO). The April STEO forecast for retail gas (regular) is 10 cents per gallon higher on an annual average basis in 2024 compared with the March STEO, due to rising wholesale gasoline prices as well as higher crude oil prices. The EIA now forecasts the wholesale gasoline price will average more than $2.70/gal in 2024, also 10 cents/gal more than in 2023. The higher forecast wholesale gasoline prices compared with the March STEO reflects the agency’s expectation of more gasoline exports and lower gasoline inventories, leading to an increase in the 2024 annual average crack spread for gasoline relative to last month’s forecast.
Get A Demo
Vertical IQ’s Industry Intelligence Platform
See for yourself why over 60,000 users trust Vertical IQ for their industry research and call preparation needs. Our easy-to-digest industry insights save call preparation time and help differentiate you from the competition.
Build valuable, lasting relationships by having smarter conversations -
check out Vertical IQ today.