Energy Analytics

Is Price Creep Coming for Oilfield Services?

byEnverus

Are we seeing the first little clawbacks of price creep back in drilling and completing new wells? We don’t have a lot of evidence yet, but a few signs of increasing prices for oilfield services (OFS) are appearing on the horizon. For example, Devon Energy said that per unit expenses are up by ~5% in the quarter as a result of severe winter weather in Texas. We know the February freeze generated some supply scarcity after temporary shutdowns across the state of sand mining, chemical blending and even chemical feedstock from the refineries. This capacity was not down for long, days to a week in most cases, but this lack of production caused a drawdown on supplies of consumables.

The temporary shortages will work themselves out, but let’s consider recent tough times for OFS companies. Last year they had to turn inventory into cash to survive a sharp drop in drilling and completion activity after oil prices crashed; now they are expected to turn cash back into inventory when service prices are at all-time lows but those for raw materials (steel, diesel and chemical feedstock) costs are increasing. It is difficult for OFS firms to sink even more cash into restarting facilities and refurbishing equipment in storage without a guarantee of stronger pricing. Additionally, staff shortages could also push up prices. While some oilfield hands that will always be oilfield hands, a truck driver can change industries to one that is less cyclical, meaning OFS companies may have to pay up to attract back workers.

The OFS sector gained new efficiencies and new abilities to work lean throughout the 2020 downturn, lessons that will stick around for a while. We will be looking at our OpenInsights Market Indices (Figure 1) for data on how the various factors play out. What do you think will happen?

FIGURE 1 | U.S. Fracture Sand Index

Picture of Enverus

Enverus

Energy’s most trusted SaaS platform — creating intelligent connections that uncover insights and opportunities to deliver extraordinary outcomes.

Subscribe to the Enverus Blog

A weekly update on the latest “no-fluff” insight and analysis of the energy industry.

Related Content

Enverus_Press_Release_Power_Energy_Transition_MandA_Thumbnail
Energy Transition
ByAdam Robinson, Enverus Intelligence® | Research (EIR) Contributor

A combined $92 billion in energy and artificial intelligence (AI)-related investments were announced across Pennsylvania last week, with projects ranging from new data centers to natural gas plants and grid modernization efforts.

Enverus Press Release - Welcome to EVOLVE 2025: Where visionaries converge to shape the future of energy
Power and Renewables
ByColton Wright

As demand for AI, cloud computing and digital infrastructure continues to surge, hyperscale data centers have quickly become some of the largest and fastest-growing energy consumers in North America. For developers, grid operators and investors, knowing where the biggest loads are concentrated...

Breaking news alert on the impact on oil prices due to Israel attacking Iran
Power and Renewables
ByColton Wright

The One Big Beautiful Bill Act (OBBBA) has changed the game for renewable energy developers. With fewer subsidies to fall back on, developers are being pushed to rethink where and how they build projects. It’s no longer about chasing tax...

Enverus Press Release - Enverus releases Investor Analytics: Refined, actionable financial insights at your fingertips
Power and Renewables
ByDaniel Manfre Jaimes

In the dynamic landscape of energy markets, accurate load forecasting is essential for informed decision-making. Enverus power forecasting solutions have consistently demonstrated exceptional performance, particularly during extreme weather events and critical peak demand periods. Complementing this reliability, our ongoing commitment...

How the One Big Beautiful Bill Act could change clean energy tax credit economics
Energy Transition
ByAlex Nevokshonoff, Senior Analyst, Enverus Intelligence® | Research (EIR) Contributor

The One Big Beautiful Bill Act (OBBBA), enacted on July 4, introduces sweeping changes to U.S. energy policy, significantly altering the tax credit landscape for clean energy projects.

Enverus Press Release - Upstream M&A climbs to $105 billion in 2024
Trading and Risk
ByKiana Cruz

In today’s fast-paced markets; traders don’t just need data, they need decisions. At EVOLVE 2025, the Trading & Risk session, “AI-Powered Trading Intelligence: Streamlining Decision Workflows,” spotlighted how artificial intelligence is evolving from a buzzword to a business-critical tool for...

data-center-demand
Energy Transition
ByAdam Robinson, Enverus Intelligence® | Research (EIR) Contributor

The Texas Tech University (TTU) System and Fermi America announced an 11 GW data center powered by a mix of natural gas, utility grid power, solar, wind and nuclear energy. The newly founded power company is building one of the...

Enverus Press Release - Enverus PRISM® now available for Europe
Trading and Risk
ByKiana Cruz

EVOLVE 2025 brought together leading voices across energy trading, analytics and clean fuels to unpack today’s most pressing market dynamics. From evolving benchmarks to retail analytics, one thing rang loud and clear: adaptation isn’t optional, it’s strategic. We attended four...

Black-lady-with-powerline
Energy Transition
ByCorianna Mah, Analyst, Enverus Intelligence® Research

A massive heat dome swept across the eastern U.S. last week, driving temperatures into the triple digits and pushing the PJM Interconnection grid to its highest peak load since 2006.

Let’s get started!

We’ll follow up right away to show you a quick product tour.

Let’s get started!

We’ll follow up right away to show you a quick product tour.

Sign up for our Blog

Register Today

Sign Up

Power Your Insights

Connect with an Expert

Access Product Tour

Speak to an Expert