The world;’s largest oilfield services company has propped its bottom line up by an additional $470million year on year in the third quarter.
Schlumberger reported income before taxes of $677million in this quarter, compared to $200million in the same period last year.
Total year on year revenue for the three months to the end of September was up 13% to $7.9billion.
Schlumberger chairman and chief executive Paal Kibsgaard said that the North American shale and drilling markets led the growth.
The Russian and the North Sea sectors also saw “strong” sequential activity growth, according to Kibsgaard.
This was primarily driven by wireline activity.
Kibsgaard told investors: “Activity growth in the third quarter was again led by our North America Land GeoMarket, where we continued to gain market share in both hydraulic fracturing and drilling services despite the decelerating rig count growth.
“We also saw strong sequential activity growth in Russia, the North Sea, and Asia, while our activity in the rest of the world was largely flat compared with the second quarter.
“In the international markets, revenue was essentially flat with the second quarter, with Europe/CIS/Africa growing 5% due to strong summer activity in the Russia & Central Asia, United Kingdom & Continental Europe, and Norway & Denmark GeoMarkets. ”
Kibsgaard said in his outlook on the industry that the reduction in global oil inventories in the third quarter is “clearly showing that the oil market is now in balance”.
He said investment appetite in the US was “moderating” and noted suggestions from OPEC countries about production cuts extending into the new year.
Finally he touched upon the “unprecedented low levels” of investment outside of the US which he claimed raised the likelihood of a medium-term global supply challenge.
Kibsgaard said: “A continuation of these market trends, combined with further steady draws in global oil inventories is now creating the required foundation for further upward movement in oil prices and subsequent growth in global exploration and production investment.
“And while there is still some level of uncertainty around the exact timing of this industry recovery, we see a number of market factors and data points now emerging that make us increasingly positive and optimistic about the outlook for our global business.
“It is also worth noting that the geopolitical risk premium on the oil price, which was quite significant in the past, has been replaced in many ways today by an oversupply discount.
“Given the visible tightening of the supply and demand balance and the current geopolitical tensions in many of the world’s key oil producing regions, a geopolitical risk premium may again become a significant factor.”
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