Middle East land drilling rig demand forecast to rise 60% by 2035: Westwood

By Anoop Menon

Demand for land drilling rigs in the Middle East is forecast to increase by 60 percent from 2025 levels to approximately 820 units by 2035, driven by investment in unconventional gas developments and crude oil production expansion, according to Westwood Global Energy Group.

The UK-based energy consultancy's Global Land Drilling Rig Outlook 3Q 2026 expects regional drilling activity to recover from 2027, following disruptions caused by the Middle East conflict in 2026.

Saudi Arabia and the UAE are expected to lead the recovery, with drilling activity in the UAE projected to increase as OPEC-related production constraints ease.

The UAE has set a target of increasing maximum crude oil production capacity to 5 million barrels per day (bpd). ADNOC’s focus on natural gas self-sufficiency and expanded LNG export capabilities is driving deeper drilling programmes for unconventional and sour gas reservoirs.

"The conflict in the Middle East has significantly disrupted drilling activity this year, particularly in Iraq. A return to 2025 levels of rig demand will depend on regional security stabilising and reliable access to export routes," said Ben Wilby, Research Manager, Onshore Energy Services at Westwood.

He added that operators continued to make long-term commitments to the region, supporting expectations of a recovery once operating conditions stabilise.

Additional fleet requirements

Wilby told Zawya Projects that reactivating idle rigs would help meet future demand in the Middle East but equipment redeployment from other markets would remain important.

Reactivating existing idle rigs will play a role. However, the idle rig fleet in the Middle East is relatively tight, meaning redeployments from other markets, particularly the US Super-Spec fleet, are expected to continue to play an important role in meeting additional demand. With demand increasing in the US and in other places that require super-specification units such as Argentina and Australia, the number of units able to move to the Middle East may be limited anyway."

He said National Oil Companies' (NOCs) emphasis on local content could also influence how international drilling contractors participate in the regional market.

"At the same time, many Middle Eastern NOCs are prioritising local companies due to the importance of in-country value (ICV) requirements. This could limit the number of rigs brought into the region by US contractors anyway, with these contractors instead partnering with local companies through joint ventures (JV). One example is the well-established SANAD JV between Saudi Aramco and Nabors, which is currently undertaking a programme to build 50 rigs."

High-specification rigs

Westwood expects demand for high-horsepower drilling rigs (rated above 1,500 HP) to grow as operators target deeper and more technically complex reservoirs.

"The Middle East high-spec rig fleet could increase by around 16 percent from 2025 levels by 2030 and 22 percent by 2035,” said Wilby. “Some older high-specification units may also be retired where the cost of upgrading them is prohibitive, further increasing the requirement for new high-specification rigs."

High-horsepower rigs are forecast to achieve average utilisation of 64 percent between 2026 and 2035, compared with 35 percent for lower-horsepower units.

The shift towards more advanced drilling equipment is also encouraging the redeployment of underutilised US rigs to international markets, including the Middle East, Argentina and Australia.

"Operators are drilling deeper, more complex wells and increasingly want modern technology and automation to improve efficiency and safety. Contractors need to make sure their fleets meet increasingly demanding operator specifications if they want to capitalise on that growth," Wilby said.

Higher dayrates and drilling costs

Wilby said he expects tightening high-specification rig availability and increasing well complexity to push contractor dayrates and drilling costs higher in the Middle East.

"With high utilisation and increasing well complexity, dayrates in the Middle East are expected to rise over the coming years, with drilling costs also increasing as wells become more challenging and rig rates climb. Partially offsetting these pressures is the growing adoption of technologies such as automation, which can improve drilling efficiency and reduce well delivery times."

He said international drilling expertise could also help improve the economics of unconventional developments in the region.

"Unconventional projects, such as those being undertaken by Turnwell Industries in the UAE, are also benefiting from the involvement of rig contractors and OFS (Oil Field Services) companies with extensive experience in the US Lower-48. The transfer of this expertise and technology should help improve drilling efficiency and mitigate some of the higher costs associated with establishing unconventional operations."

While the Westwood report didn’t disclose day rates, Kuwait-listed Action Energy Company had stated during its H1 2026 conference call in August that the average day rate for a 1,500 HP rig in the Gulf state is around 8,000 Kuwaiti dinars and the average day rate of a 3,000 HP or 2,000 HP rig is around KWD 16,000.

Global demand outlook

Globally, Westwood forecasts average demand of approximately 4,250 land drilling rigs annually between 2026 and 2030, increasing to nearly 4,550 rigs between 2031 and 2035. The latter figure represents a 12 percent increase over the 2021–2025 average.

Meanwhile, the gradual retirement of older rigs is expected to narrow the supply-demand gap, pushing average global rig utilisation from 48 percent in 2026–2030 to 53 percent in 2031–2035.

(Reporting by Anoop Menon; Editing by Dennis Daniel)

(anoop.menon@lseg.com)

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