--- title: 2022 Oil and Gas Market Outlook | Panther Fluids description: Despite the growth in 2021, the Oil and Gas Industry had ups and downs in consultation, supply chain, and labor shortages. image: https://www.thepanthercompanies.com/hubfs/panther-2022-market-outlook.jpg --- [Skip to content](https://www.thepanthercompanies.com/blog/panther-2022-market-outlook-never-a-dull-moment-in-the-oilfield#main-content) Close - Services - [Fluids](https://www.thepanthercompanies.com/fluids) - [Fluids Management](https://www.thepanthercompanies.com/drilling-fluids-management) - [Solids Control](https://www.thepanthercompanies.com/solids-control) - [Haul Off and Disposal](https://www.thepanthercompanies.com/haul-off-disposal) - [Rentals](https://www.thepanthercompanies.com/rentals) - [Frac Tank](https://www.thepanthercompanies.com/frac-tank-rentals) - [Bulk Tank](https://www.thepanthercompanies.com/bulk-tank-rentals) - [Open Top Tank](https://www.thepanthercompanies.com/open-top-tank-rentals) - 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[The Panther Blog](https://www.thepanthercompanies.com/blog) - [Carbon Capture Guide](https://lp.thepanthercompanies.com/carbon-capture-and-storage-in-oil-and-gas) - [Total Fluid Management Guide](https://www.thepanthercompanies.com/drilling-fluid-management-service-guide) - [About](https://www.thepanthercompanies.com/about) - [History](https://www.thepanthercompanies.com/about#history) - [Leadership](https://www.thepanthercompanies.com/about#team) - [Locations](https://www.thepanthercompanies.com/operations#locations) - [Environment](https://www.thepanthercompanies.com/about#esg) - [The Panther Advantage™](https://www.thepanthercompanies.com/the-panther-advantage) - [Contact](https://www.thepanthercompanies.com/contact) ![](https://www.thepanthercompanies.com/hs-fs/hubfs/panther-2022-market-outlook.jpg?width=575&name=panther-2022-market-outlook.jpg) [The Panther Companies](https://www.thepanthercompanies.com/blog/author/panther) January 12, 2022 # 2022 Oil and Gas Market Outlook: Key Trends [Previous](https://www.thepanthercompanies.com/blog/security-beyond-the-oilfield-remote-deterrence-and-video-monitoring-play-a-key-role) [Next](https://www.thepanthercompanies.com/blog/truck-driver-shortage-trickles-down-to-the-oil-and-gas-industry) ![panther-2022-market-outlook](https://www.thepanthercompanies.com/hs-fs/hubfs/panther-2022-market-outlook.jpg?width=400&height=267&name=panther-2022-market-outlook.jpg)The oil and gas market grew significantly in 2021, despite prolonged pandemic woes. At the beginning of the year, rig count was 360 and WTI was around $47. By the end of 2021, rig count was 586 and WTI was around $76. Growth was primarily driven by private companies, while public companies maintained a steady drilling pace. We have a positive outlook for the coming year. Operators are moving forward with increased budgets and new drilling programs, rig count continues to increase, and fiscal discipline will lead to sustained growth. There will be challenges, but the industry is resilient and will tackle these challenges head-on. ### Production and spending trends in 2022 Capital discipline will be the name of the game for public companies in 2022. Although oil prices are up, Wall Street is demanding decreased spending. Reinvesting cash flow and aggressive growth were the main trends over the past 20 years. In the post-pandemic and downturn-shy market, investors now want companies to use their cash flow to pay back debt and improve shareholder returns. For example, [ConocoPhillips’ 2022 plan](https://www.reuters.com/business/conocophillips-forecasts-2022-capex-72-bln-2021-12-06/) includes relatively flat production and higher capital returns to shareholders compared to 2021. Most of the large companies are hedged at lower oil prices and cannot take advantage of increased commodity pricing. As a result, the major oil companies will likely keep production relatively flat compared to 2021. Like U.S. oil producers, OPEC+ members are being cautious. Skyrocketing gasoline prices and an oil shortage prompted the U.S. government to tap into the strategic petroleum reserves and call on [OPEC+ to produce more oil at the end of 2021](https://www.cnn.com/2021/12/02/energy/opec-market-power/index.html); however, the group refused to increase output. Both of these trends are advantageous for private companies in the U.S. Start-up and private companies have more spending flexibility and opportunity for growth. They can take advantage of current high oil prices and build up a portfolio of proven assets to attract potential buyers and investors. Oil industry growth in 2022 will likely be driven by private companies, as public companies remain steady and stable. ### Consolidation The industry saw significant company consolidation and asset sales in 2021. Consolidation was a survival tactic following a slew of bankruptcies among both operators and service companies. Chesapeake, Concho, Primexx, High Point Resources, Seadrill and Basic Energy Services are among the companies who either filed for bankruptcy or were bought out. However, consolidation can still drive industry growth. Employees who are laid off after mergers or acquisitions often start their own private companies. Asset sales and consolidation are also driven by financial discipline. As companies face pressure from investors to spend less and increase shareholder returns, many companies choose to focus only on their core assets, selling high-risk or low-profit assets. ESG (environmental, social and governance) policies play a role in industry consolidation. Major public firms are under increasing pressure from shareholders to reduce emissions or even divest from oil and gas altogether. A recent example is Shell’s sale of its Delaware basin assets to ConocoPhillips. European-based Shell has stringent emissions reductions requirements, prompting them to sell some of their high-carbon assets to meet shareholder demands. ### Supply chain challenges and the labor shortage The ongoing global supply chain issues will continue to impact the industry in 2022. We expect delays and shortages for pipe, casing, chemicals and raw materials. This will be a challenge for suppliers and service companies who want to have materials on hand for customers, but do not want to be stuck with extra inventory in the event of another downturn. Equipment shortages could be another challenge in 2022. During the recent downturns, many service companies took outdated drilling rigs, frac trucks or wireline trucks out of service and did not replace them. Now that oil prices have recovered, drilling activity is increasing. However, the amount of equipment remains static and it will be costly to return decommissioned equipment to service. Additionally, operators want state-of-the-art drilling rigs, which are in limited supply, [according to Helmerich & Payne CEO John Lindsay](https://www.naturalgasintel.com/hp-looking-to-raise-flexrig-prices-as-eps-push-demand-for-super-specs/). It is uncertain whether companies will manufacture or purchase new equipment, or if they will continue to limit their overhead. The labor shortage will also impact oilfield operations and pricing. The widespread shortage of truck drivers has made oilfield transportation difficult and operators are experiencing delays in receiving materials. Truck availability is low, especially for companies without dedicated trucking company relationships. Companies are struggling to find experienced field personnel, despite the increase in rig count and oil price. Many of the oilfield workers who were laid off in 2020 found jobs outside the industry, forcing companies to hire staff with less experience. There may be a slight increase in safety issues related to inexperienced operations crews. ### Steady and stable in the new year Panther is no stranger to the oilfield’s ups and downs. We are looking forward to steady, sustained growth in the industry next year. Drilling activity and growth will largely be driven by private companies, while public companies focus on capital discipline and maximizing shareholder returns. Project management and relationships are our priority, and we are prepared to meet the challenges of the coming year. #### [The Panther Companies](https://www.thepanthercompanies.com/blog/author/panther) [mailto:info@panther.com](mailto:info@panther.com) ## RELATED ARTICLES ### [The Panther Companies January 25, 2022 2 min read How Truck Driver Shortages Affect Oil and Gas We have all seen the effects of the nation’s supply chain crisis in everyday life. From stacks of shipping containers piling up ... Start Reading](https://www.thepanthercompanies.com/blog/truck-driver-shortage-trickles-down-to-the-oil-and-gas-industry) ### [Garrow Wessendorff January 24, 2024 6 min read 2024 Oil and Gas Market Outlook: Key Trends Uncertainties create a variety of possibilities for 2024, setting the stage for a year of cautious optimism in the oil and gas ... Start Reading](https://www.thepanthercompanies.com/blog/2024-oil-market-outlook) ### [Chris Gallio August 9, 2022 4 min read 2022 Permian Basin Activity and Technology Update The Permian Basin historically accounts for almost half of U.S. oil production. Basin production spans over a century with many ... Start Reading](https://www.thepanthercompanies.com/blog/summer-2022-permian-basin-roundup) SERVICES - [Fluids Management](https://www.thepanthercompanies.com/fluids#fluids) - [Solids Control](https://www.thepanthercompanies.com/fluids#solids) - [Haul Off & Disposal](https://www.thepanthercompanies.com/fluids#haul) - [Equipment Rental](https://www.thepanthercompanies.com/rentals) PRODUCTS - [Drilling Fluid Systems](https://www.thepanthercompanies.com/products) - [Proprietary Additives](https://www.thepanthercompanies.com/products#add) - [Production Chemicals](https://www.thepanthercompanies.com/production-chemicals) --- [The Panther Advantage™](https://www.thepanthercompanies.com/the-panther-advantage) RESOURCES - [Blog & News](https://www.thepanthercompanies.com/blog) - [Case Studies](https://www.thepanthercompanies.com/case-studies) - [Downloads](https://www.thepanthercompanies.com/downloads) --- [Total Fluid Management](https://www.thepanthercompanies.com/drilling-fluid-management-service-guide) - [ABOUT](https://www.thepanthercompanies.com/about) - [OPERATIONS](https://www.thepanthercompanies.com/operations) - [LOCATIONS](https://www.thepanthercompanies.com/operations#locations) - [LEADERSHIP](https://www.thepanthercompanies.com/about#team) - [ENVIRONMENT](https://www.thepanthercompanies.com/about#esg) - [PRIVACY POLICY](https://www.thepanthercompanies.com/privacy-policY) [![pantherwhite](https://www.thepanthercompanies.com/hs-fs/hubfs/pantherwhite.png?width=300&height=83&name=pantherwhite.png)](https://www.thepanthercompanies.com) [909 Wirt Rd. Suite 200 Houston, TX 77024](https://goo.gl/maps/RxTCEzMpLJ2zWu2A9) [info@pantherfluids.com](mailto:info@pantherfluids.com) [832.260.0082](tel:+18322600082) ```json { "@context" : "https://schema.org", "@type" : "Organization", "address" : { "@type" : "PostalAddress", "addressCountry" : "", "addressLocality" : "Houston", "addressRegion" : "TX", "postalCode" : "77024", "streetAddress" : "909 Wirt Rd." }, "knowsLanguage" : "en", "logo" : { "@type" : "ImageObject", "url" : "https://f.hubspotusercontent30.net/hubfs/7245686/PF-Logo-Companies-Alternate-A-Color-700.png" }, "name" : "The Panther Companies", "url" : "https://www.thepanthercompanies.com/blog/panther-2022-market-outlook-never-a-dull-moment-in-the-oilfield" } ``` ```json { "@context" : "https://schema.org", "@type" : "BlogPosting", "abstract" : "Despite the growth in 2021, the Oil and Gas Industry had ups and downs in consultation, supply chain, and labor shortages.", "author" : { "@type" : "Person", "name" : "The Panther Companies" }, "dateModified" : "July 21, 2026 9 PM", "datePublished" : "January 12, 2022 2 PM", "headline" : "2022 Oil and Gas Market Outlook: Key Trends", "image" : "https://7245686.fs1.hubspotusercontent-na1.net/hubfs/7245686/panther-2022-market-outlook.jpg", "inLanguage" : "", "keywords" : "[Industry Trends]", "mainEntityOfPage" : { "@type" : "WebPage" }, "name" : "2022 Oil and Gas Market Outlook: Key Trends", "publisher" : { "@type" : "Organization", "logo" : { "@type" : "ImageObject", "url" : "https://f.hubspotusercontent30.net/hubfs/7245686/PF-Logo-Companies-Alternate-A-Color-700.png" }, "name" : "The Panther Companies" }, "text" : "The oil and gas market grew significantly in 2021, despite prolonged pandemic woes. At the beginning of the year, rig count was 360 and WTI was around $47. By the end of 2021, rig count was 586 and WTI was around $76. Growth was primarily driven by private companies, while public companies maintained a steady drilling pace. We have a positive outlook for the coming year. Operators are moving forward with increased budgets and new drilling programs, rig count continues to increase, and fiscal discipline will lead to sustained growth. There will be challenges, but the industry is resilient and will tackle these challenges head-on. Production and spending trends in 2022 Capital discipline will be the name of the game for public companies in 2022. Although oil prices are up, Wall Street is demanding decreased spending. Reinvesting cash flow and aggressive growth were the main trends over the past 20 years. In the post-pandemic and downturn-shy market, investors now want companies to use their cash flow to pay back debt and improve shareholder returns. For example, ConocoPhillips’ 2022 plan includes relatively flat production and higher capital returns to shareholders compared to 2021. Most of the large companies are hedged at lower oil prices and cannot take advantage of increased commodity pricing. As a result, the major oil companies will likely keep production relatively flat compared to 2021. Like U.S. oil producers, OPEC+ members are being cautious. Skyrocketing gasoline prices and an oil shortage prompted the U.S. government to tap into the strategic petroleum reserves and call on OPEC+ to produce more oil at the end of 2021; however, the group refused to increase output. Both of these trends are advantageous for private companies in the U.S. Start-up and private companies have more spending flexibility and opportunity for growth. They can take advantage of current high oil prices and build up a portfolio of proven assets to attract potential buyers and investors. Oil industry growth in 2022 will likely be driven by private companies, as public companies remain steady and stable. Consolidation The industry saw significant company consolidation and asset sales in 2021. Consolidation was a survival tactic following a slew of bankruptcies among both operators and service companies. Chesapeake, Concho, Primexx, High Point Resources, Seadrill and Basic Energy Services are among the companies who either filed for bankruptcy or were bought out. However, consolidation can still drive industry growth. Employees who are laid off after mergers or acquisitions often start their own private companies. Asset sales and consolidation are also driven by financial discipline. As companies face pressure from investors to spend less and increase shareholder returns, many companies choose to focus only on their core assets, selling high-risk or low-profit assets. ESG (environmental, social and governance) policies play a role in industry consolidation. Major public firms are under increasing pressure from shareholders to reduce emissions or even divest from oil and gas altogether. A recent example is Shell’s sale of its Delaware basin assets to ConocoPhillips. European-based Shell has stringent emissions reductions requirements, prompting them to sell some of their high-carbon assets to meet shareholder demands. Supply chain challenges and the labor shortage The ongoing global supply chain issues will continue to impact the industry in 2022. We expect delays and shortages for pipe, casing, chemicals and raw materials. This will be a challenge for suppliers and service companies who want to have materials on hand for customers, but do not want to be stuck with extra inventory in the event of another downturn. Equipment shortages could be another challenge in 2022. During the recent downturns, many service companies took outdated drilling rigs, frac trucks or wireline trucks out of service and did not replace them. Now that oil prices have recovered, drilling activity is increasing. However, the amount of equipment remains static and it will be costly to return decommissioned equipment to service. Additionally, operators want state-of-the-art drilling rigs, which are in limited supply, according to Helmerich & Payne CEO John Lindsay. It is uncertain whether companies will manufacture or purchase new equipment, or if they will continue to limit their overhead. The labor shortage will also impact oilfield operations and pricing. The widespread shortage of truck drivers has made oilfield transportation difficult and operators are experiencing delays in receiving materials. Truck availability is low, especially for companies without dedicated trucking company relationships. Companies are struggling to find experienced field personnel, despite the increase in rig count and oil price. Many of the oilfield workers who were laid off in 2020 found jobs outside the industry, forcing companies to hire staff with less experience. There may be a slight increase in safety issues related to inexperienced operations crews. Steady and stable in the new year Panther is no stranger to the oilfield’s ups and downs. We are looking forward to steady, sustained growth in the industry next year. Drilling activity and growth will largely be driven by private companies, while public companies focus on capital discipline and maximizing shareholder returns. Project management and relationships are our priority, and we are prepared to meet the challenges of the coming year.", "url" : "https://www.thepanthercompanies.com/blog/panther-2022-market-outlook-never-a-dull-moment-in-the-oilfield", "wordCount" : "1028" } ```