Hunting Expects Oil Producers to Defer Projects
British oilfield services company Hunting Plc expects oil and gas producers to defer some projects as a recent decline in crude prices could hit their short-term budgets, it said on Monday.
Oilfield service companies, including U.S.-based Schlumberger (SLB), have been hit this year by a slowdown in demand as regional oil prices have fallen and oil-producing customers face transportation bottlenecks.
"Clients are indicating caution on committed spend for the early part of 2019 as the lower oil price and pipeline bottlenecks in the Permian basin indicate a short term slowing in completion activity," Hunting said of its Titan business, which operates mainly in the U.S. Permian shale basin.
"Management enter 2019 with a cautious outlook," it added.
Last week, Hunting's British rival Wood Plc also said it was cautious about the outlook for further contract awards, but said it was not seeing customers walking away from commitments or cancelling contracts.
Hunting, which supplies equipment to oil and gas exploration companies, said results for the January-November period were in line with its expectations. It forecast 2018 capital expenditure of about $30 million.
(Reporting by Tanishaa Nadkar in Bengaluru Editing by Saumyadeb Chakrabarty and Sai Sachin Ravikumar)