Oilfield services provider SLB reports lower quarterly profits on Iran War Hit
SLB reported on Friday a 'falling profit in the first quarter, as disruptions caused by the war in Iran affected 'demand for oilfield services in a key oil producing region.
Before the bell, shares of the company dropped 3%.
CEO Olivier Le Peuch said, "It has been a difficult start to the new year due to disruptions that have affected our business in the Middle East."
He added that "the impact was most noticeable in Well?Construction, and Reservoir Performance".
Total revenue for the quarter was $8.72 billion, with revenues from Middle East Asia dropping 10% to $2.69 Billion.
SLB's largest market is the Middle East, which will account for 34% of its revenue by 2025.
Top oilfield services provider said that it had demobilized its operations in some countries as a result of customer actions taken to protect personnel and facilities.
Oil prices have surged due to the attacks on energy infrastructure in the region, and Iran's closure of the Strait of Hormuz. However, this has not translated into higher demand for SLB or its rivals because oil producers are taking a more cautious stance and not increasing drilling activity.
Houston-based company reported net income of $752 million or 50 cents a share for the three months ended March 31. This compares to $797 million (or 58 cents a share) compared to 68 cents / share a year ago. (Reporting and editing by Sriraj Kalluvila in Bengaluru)
(source: Reuters)
