S&P Global: As offshore rig market continues upward trajectory, rising costs may be cause for concern

The offshore rig market has recovered from the twin blows of an oil price downturn and the COVID-19 pandemic, but now rising inflation has the industry concerned about costs and funding for future projects, said Rod Hutton, Associate Director – Petrodata Rigs at S&P Global. Offshore CAPEX is expected to increase 29% by 2027, and the market is tightening for the highest specification rig categories due to rising operator demand and limited supply. Speaking to DC from the 2023 IADC World Drilling Conference in London, Mr Hutton outlines where he expects the floater and jackup markets to fall in the near-term future, which regions will drive demand and what the current economic landscape will mean for rig contracts.