OFFSHORE PATROL VESSELS MARKET ANALYSIS

Market Challenges And Opportunities

Global Offshore Patrol Vessels Market – Drivers

Increasing Demand for Coastal Security

Offshore patrol vessels are used by navies and coast guards for various applications such as search and rescue, counter-narcotics and drug smuggling, and humanitarian operations. Moreover, offshore patrol vessels are used for patrol and surveillance of offshore assets such as oil platforms and for convoy protection and anti-mine missions.

Patrol vessels are used mainly for detecting drug trafficking, smuggling, and monitoring and controlling marine pollution. For instance, the U.S. Customs and Border Protection (CBP) inspect criminal networks and offers domain awareness in the air and maritime environments and responds to emergencies. For instance, on March 1, 2023, the U.S. CBP and Air and Marine Operations (AMO) agents seized 2,351 pounds of cocaine from a vessel attempting to reach the coast in Southern Puerto Rico. Therefore, increasing focus on coastal security leads to high demand for offshore patrol vessels, which is expected to boost market growth over the forecast period.

Global Offshore Patrol Vessels Market – Opportunities

Increasing investments and activities in offshore oil and gas exploration        

Increasing investments and exploration activities in offshore oil and gas sector is expected to increase demand for offshore patrol vessels. According to the Bureau of Ocean Energy Management, Offshore Federal production in FY 2020 reached approximately 641 Mn barrels of oil and 882 billion cubic feet of gas, almost all of which was produced in the Gulf of Mexico. This accounts for about 15% of all domestic oil production and 2% of domestic natural gas production. Saudi Arabia, Brazil, Mexico, Norway, and the U.S. are the major offshore oil-producing countries. Although the oil and gas industry witnessed a downturn since 2014, the investment in oil and gas industry increased in 2022 and is expected to rise further over the forecast period. According to Rystad Energy, independent energy research and business intelligence company headquartered in Oslo, on February 02, 2023, the global market for oil and gas contractors is anticipated to rise to a peak of US$ 1 trillion by 2025. Increasing investments in the offshore oil and gas sector are expected to significantly fuel exploration, development, and production activities in the offshore sector. This, in turn, is expected to increase demand for offshore patrol vessels for monitoring offshore activities.

Global Offshore Patrol Vessels Market – Restraints

High Cost of Manufacturing and Maintenance of Offshore Patrol Vessels

The shipbuilding industry is undergoing rapid transformation due to the introduction of advanced technologies that are integrated into offshore patrol vessels. Offshore patrol vessels are in huge demand due to their effective monitoring and operational activities at the coastline. However, the high cost of components and technologies that are used in offshore patrol vessels are limiting the market growth. Various additional costs are involved in the production of offshore patrol vessels such as fluctuating labor costs, maintenance costs, and the cost of components used in manufacturing the vessels

For instance, patrol vessels that are less than 50 mm in size cost around US$ 30-40 million while the cost of patrol vessels of 90 mm in size is around US$ 100 million. Therefore, the high cost of manufacturing offshore patrol vessels is one of the restraining factors that could hamper the global offshore patrol vessels market growth over the forecast period. In a huge boost to achieve ‘Aatmanirbharta’ in defence, Ministry of Defence, on March 30, 2023, signed contracts with Indian shipyards for acquisition of 11 Next Generation Offshore Patrol Vessels and six Next Generation Missile Vessels at an overall cost of approx. Rs 19,600 crore.