NORWALK, Connecticut – A healthier outlook is predicted for oilfield services in 2011, according to an IHS Herold review. The Gulf of Mexico drilling moratorium is offset by rising oil prices, unconventional drilling in North America, and multiple opportunities worldwide.
“Many of the service companies, and in particular the offshore drilling companies, took a financial beating following the Gulf drilling moratorium,” said John B. Parry, principal energy analyst at IHS and author of the IHS Herold “Review on The Oil Field Services Sector”.
“Companies exposed to the Gulf incurred costs related to redeploying assets and personnel to other opportunities, primarily onshore North America or international markets,” Parry continued.
“With the lifting of the moratorium, the industry has moved to a more offensive posture. While valuation of the underlying equities in the sector remain about 35% below their peak in 2008, we believe strong oil prices and higher exploration and production budgets will help drive growth in the oil field services sector in 2011; and current forward earnings estimates suggest a potential restoration to prior peak 2008 stock price levels by 2012.”
Oil field services on road to recovery, says IHS
A healthier outlook is predicted for oilfield services in 2011, according to an IHS Herold review.