Schlumberger is an oilfield services company. A big un.
- biggest offshore drilling contractor in terms of revenue
Chief Executive Officer Olivier Le Peuch is bullish energy for the year ahead. Much of the firm's earning call/report is focused on the oil services business, as you'd expect, but there are a few snippets of relevance to oil/energy markets more generally. In brief:
On Q4 2022:
- In the Middle East, revenue increased by double digits sequentially, with growth in Saudi Arabia, Iraq, and the United Arab Emirates in the solid teens, affirming the much-anticipated acceleration of activity in the region.
- In North America, US land rig count remains at robust levels, although the pace of growth is moderating.
Looking ahead,
- we believe the macro backdrop and market fundamentals that underpin a strong multi-year upcycle for energy remain very compelling in oil and gas and in low-carbon energy resources. First, oil and gas demand is forecast by the International Energy Agency (IEA) to grow by 1.9 million barrels per day in 2023 despite concerns for a potential economic slowdown in certain regions. In parallel, markets remain very tightly supplied. Second, energy security is prompting a sense of urgency to make further investments to ensure capacity expansion and diversity of supply. And third, the secular trends of digital and decarbonization are set to accelerate with significant digital technology advancements, favorable government policy support, and increased spending on low-carbon initiatives and resources.
- The impact of loosening COVID-19 restrictions and an earlier than expected reopening of China could support further upside potential over 2023.
If he's right (he'll be accused of talking his book, of course, but aside from that) more tailwinds for the oil price, in the near term at least.
