Page 4 - NorthAmOil Week 04 2023

NorthAmOil COMMENTARY NorthAmOil

Oilfield services firms hope for

continued structural upcycle

The top three oilfield service firms are hoping that the recent industry upcycle

will continue as they look beyond North America for business

GLOBAL THE Big Three oilfield services companies revenue of $5.6bn for the fourth quarter, slightly
have registered high profits for 2022. The com- higher than analysts’ estimates.
WHAT: bined net income of Halliburton, Baker Hughes For 2022, its revenue for North America rose
Aggregate profits in 2022 and SLB – formerly Schlumberger – last year 51% compared to 2021 and its international rev-
were high for two of the amounted to $4.4bn, hitting its highest level enue was up 20%. Halliburton’s full-year reve-
Big Three oilfield services since the peak of the US shale boom in 2014. nue reached $20.3bn, representing an increase
firms. Oil prices have risen because of geopolitics of 33% year on year, while its full-year operating
and subsequent fuel shortages – especially in income came in at $2.7bn, a rise of 50% com-
WHY: the wake of Russia’s invasion of the Ukraine in pared with a year earlier.
Oil prices have buoyed February 2022 – inflation and a push for energy The company’s North America revenue in
drilling activity. security. Benchmark Brent crude prices have the fourth quarter of 2022 totalled $2.6bn, a 1%
been trading at $87-88 per barrel, up from about decrease when compared with the third quarter
WHAT NEXT: $77 per barrel in January 2022. of 2022. This decrease was primarily driven by
The oilfield services Global oil and gas activity, including in the weather-related lower stimulation activity and
giants will be hoping that US, has been boosted as a result. The global rig artificial lift activity. The decreases were par-
the upcycle continues. count for the fourth quarter of 2022 averaged tially offset by improved activity across multiple
1,872, almost 22% higher than a year earlier, product service lines in the US Gulf of Mexico,
according to Baker Hughes data. The rate of said the company.
growth of activity, however, was slower in 2022 “Halliburton’s execution in 2022 demon-
than it had been before the start of the Covid- strated the earnings power of our strategy, and
19 pandemic. Customers of the oilfield services I expect this earnings power to strengthen in
companies have been sticking to tight spend- 2023 and beyond,” said Halliburton’s chairman,
ing plans under ongoing pressure to prioritise president and CEO, Jeff Miller. “Both operating
returns to shareholders over growth. divisions delivered strong margins in the inter-
national and North America markets.”
Beating expectations In an earnings call, executives said all of the
Halliburton, the largest supplier of hydrau- company’s fracking equipment was still booked.
lic fracturing equipment in the US, reported In 2022 Halliburton imposed higher prices on

P4 www. NEWSBASE .com Week 04 26•January•2023