The results from oil services companies like Baker Hughes (NYSE: BKR), Haliburton (NYSE: HAL), and Schlumberger (NYSE: SLB) were mixed to be sure but there is one common thread among them. The outlook for spending on oil-field services remains strong and supportive of a multi-year upcycle for the industry. Even Baker Hughes, which gave the weakest report in the Q2 cycle, is forecasting an increase in spending that will support not only revenue and earnings but healthy dividend payments as well.
“On the other hand, due to years of underinvestment globally and the potential need to replace Russian barrels, broader supply constraints can realistically keep commodity prices at elevated levels even in a scenario of moderate demand destruction. As a result, we believe the outlook for oil prices remains volatile, but still supportive of strong activity levels as higher spending is required to re-order the global energy map and likely offsets demand destruction in most recessionary scenarios,” says Baker Hughes chairman and CEO Lorenzo Simonelli.
Oilfield Services stocks
Oilfield Services stocks
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group