Hal­libur­ton sees drillers ‘tap the brakes’ on shale boom

Muscat Daily - - BUSINESS -

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

(Bloomberg)

Em­ploy­ees walk to­wards Hal­libur­ton Co ‘sand cas­tles’ at an Anadarko Petroleum Corp hy­draulic frack­ing site in Colorado, US

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