• 4 minutes England Running Out of Water?
  • 7 minutes Trump to Make Allies Pay More to Host US Bases
  • 10 minutes U.S. Shale Output may Start Dropping Next Year
  • 14 minutes Washington Eyes Crackdown On OPEC
  • 3 hours One Last Warning For The U.S. Shale Patch
  • 7 hours Once Upon A Time... North Korea Abruptly Withdraws Staff From Liaison Office
  • 7 hours Chile Tests Floating Solar Farm
  • 6 hours Oil Slips Further From 2019 Highs On Trade Worries
  • 2 hours Modular Nuclear Reactors
  • 14 hours Poll: Will Renewables Save the World?
  • 23 hours China's E-Buses Killing Diesel Demand
  • 23 hours Trump sells out his base to please Wallstreet and Oil industry
  • 19 hours China's Expansion: Italy Leads Europe Into China’s Embrace
  • 1 day Russian Effect: U.S. May Soon Pause Preparations For Delivering F-35s To Turkey
  • 1 day Trump Tariffs On China Working
  • 11 hours US-backed coup in Venezuela not so smooth
  • 17 hours New Rebate For EVs in Canada
  • 1 day Biomass, Ethanol No Longer Green
Why OPEC’s Decision To Delay Makes Sense

Why OPEC’s Decision To Delay Makes Sense

OPEC’s decision to maintain the…

Schlumberger Warns Of Moderating Investment In North America

Oil

Schlumberger (NYSE:SLB) reported on Friday a higher net profit for the third quarter, driven by North America’s onshore—but the world’s largest oilfield services group now warns that investment appetite in North America is moderating as drillers focus on financial returns instead of volume.

Schlumberger’s diluted earnings per share (EPS)—excluding integration charges—came in at $0.42 in the third quarter, up by 20 percent on the quarter and up by 68 percent compared to Q3 2016. Schlumberger’s EPS this past quarter is exactly line with the analyst consensus of $0.42.

Revenues rose by 6 percent sequentially to $7.905 billion—a couple of million above the analyst forecast of $7.903 billion—with North America revenue jumping 18 percent and international revenues basically flat compared to Q2.

In North America, Schlumberger’s revenue increase was due to “the nearly complete redeployment of our hydraulic fracturing capacity on land as robust fracturing activity continued during the third quarter,” the group said. Fracking activity was partially offset by Hurricane Harvey and activity weakness in the Gulf of Mexico. “North America land revenue experienced 23% sequential growth, driven by 42% revenue growth in hydraulic fracturing on increased fleet redeployment, market share gains, and improved pricing,” Schlumberger said.

But the oilfield services giant cautioned about the North American activity in the coming quarters, with Chairman and CEO Paal Kibsgaard saying that “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.”

Related: Can Trump Drive A Wedge Between Saudi-Russian Alliance?

However, a moderating North American investment; the possibility that OPEC will extend the cuts further; unprecedented low levels of investment outside of North America, OPEC Gulf, and Russia; and a returning geopolitical risk premium in the oil market, all point to a more optimistic view of the industry, according to Kibsgaard.

Following the results release, Schlumberger’s shares ticked up in pre-market trade on the NYSE, but fell later in the afternoon to hit $62.34 at 1:30pm EST.

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

Leave a comment

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News