Schlumberger, the world’s largest oilfield services provider, saw an increase in profit and revenues during the third quarter of 2017 compared to the prior-year period.
The company on Friday posted a profit of $545 million for the third quarter of this year, compared to a $176 million profit recorded in the same period of 2016.
During the third quarter 2017, Schlumberger’s revenues increased 6% sequentially and 13% year-over-year. Namely, the company’s revenues in 3Q 2017 totaled $7.9 billion compared to $7.5 billion in 2Q 2017 and $7.02 billion in 3Q 2016.
According to a statement by Schlumberger Chairman and CEO, Paal Kibsgaard, the activity growth during the quarter was led by the company’s North America Land GeoMarket.
Kibsgaard added: “We also saw strong sequential activity growth in Russia, the North Sea, and Asia, while our activity in the rest of the world was largely flat compared with the second quarter.”
Looking at the company’s activities geographically, North America land revenue grew 23% sequentially while the activity continued to weaken in the U.S. Gulf of Mexico.
“…The outlook remains bleak for this region based on current customer plans,” Kibsgaard said about the Gulf of Mexico region.
Commenting on the current situation in the oil & gas market, Kibsgaard stated that the oil market is now in balance, which is reflected in the upward movement in oil prices over the past month.
He supported this view by saying: “First, the investment appetite in North America land now seems to be moderating, driven by a growing focus from E&P companies on financial return and the need to operate within cash flow rather than the pursuit of production growth.
“Second, comments from several of the key OPEC Gulf countries, as well as from Russia, suggest that an extension of the existing production cuts beyond the current nine-month agreement is a possibility. And third, investment levels in the production base outside North America land, OPEC Gulf, and Russia all remain at unprecedented low levels, raising the likelihood of a medium-term global supply challenge, and increasing the urgency for higher investment.
“A continuation of these market trends, combined with further steady draws in global oil inventories is now creating the required foundation for further upward movement in oil prices and subsequent growth in global E&P investment. And while there is still some level of uncertainty around the exact timing of this industry recovery, we see a number of market factors and data points now emerging that make us increasingly positive and optimistic about the outlook for our global business.
“It is also worth noting that the geopolitical risk premium on the oil price, which was quite significant in the past, has been replaced in many ways today by an oversupply discount. Given the visible tightening of the supply and demand balance and the current geopolitical tensions in many of the world’s key oil producing regions, a geopolitical risk premium may again become a significant factor,” he concluded.
Offshore Energy Today Staff