Halliburton sees drillers ‘tap the brakes’ on shale boom
Houston, US – Halliburton Co, promising to be disciplined in adding more fracking gear to the oilfields, said US explorers are ‘tapping the brakes’ on drilling as the price of oil struggles to breach US$50 a barrel.
The comments come days after Baker Hughes data found that explorers reduced the number of US rigs for the second time in four weeks. The decline and the statements by Halliburton, the world’s biggest provider of fracking services, could bolster confidence that spending by the shale industry may be slowing as efforts by OPEC and its allies to raise oil prices have faltered.
In November, the Organization of Petroleum Exporting Countries and allies agreed to cut output, immediately boosting crude prices after the worst market rout in a generation. Since then, the US shale industry has seen a growth spurt that’s kept stockpiles topped off and prices static.
Now, signs are emerging that the US industry may be eyeing its own slowdown.
“Today, rig count growth is showing signs of plateauing and customers are tapping the brakes,” Halliburton executive chairman Dave Lesar said on a call. “This demonstrates that individual companies are making rational decisions in the best interest of their shareholders.”
The comments came after Halliburton reported that it swung to a profit in the second quarter as revenue rose 29 per cent from a year earlier to US$4.96bn. That’s more than US$1bn higher than the company reported a year earlier. The comment by Lesar surprised analysts on the call, said J David Anderson at Barclays Capital Inc.
“Optically it’s bad for service companies,” Anderson said. But it’s also a positive for the oil market as a whole, he added. Continued on