HAL, SLB: The Worst Is Over, Things Are Starting To Turn -- July 23, 2016

Anyone following earnings reports and conference calls are aware that both Halliburton and Schlumberger have said "we've" hit the bottom in the oil and gas industry, that things are starting to turn.

For the record, I don't buy it. I think HAL and SLB are both "talking their book" as the say. We'll see in January, 2017, when these companies report their 4Q16 earnings. 

There was an article, which I did not link, yesterday that said that despite HAL's and SLB's claims, in fact, the oil and gas industry was continuing to shed jobs.

Today, we get this headline: COP to trim 6% of its workforce.

ConocoPhillips will lay off approximately 6 percent of its global workforce, the exploration and production (E&P) company confirmed to Rigzone in an email.

ConocoPhillips, which has headquarters in Houston, has undertaken a series of cost-reduction measures over the last 18 months in response to the industry downturn.

Beaudo said ConocoPhillips has significantly reduced its capital activities and finished some major projects, leaving the company with “more organizational capacity” than it needs.

Much  more at the link, and it's not good news. 

Meanwhile, Bloomberg reports that Keppel, the world's largest builder of oil rigs, sees a prolonged dearth of oil-rig orders amid glut.

The company may consider reducing its workforce and mothballing some facilities in its rig-building operations because of excess capacity, the Singapore-based company said Thursday.

Keppel Offshore & Marine Ltd. has already shrunk its workforce by about 11,000 and subcontractor headcount by some 8,500 since 2015

Keppel sees a long, harsh "winter" in its rig-building business after net income fell 48 percent in the second quarter to S$205.8 million ($152 million). The company is among Asian shipyards that have cut jobs and are considering dock closures after oil prices more than halved in two years, leading to a slump in orders for offshore drilling and production, deferrals and cancellations.

The company has been hit by non-payments from one of its biggest clients, Sete Brasil Participacoes SA, which filed for bankruptcy protection in April.

********************************

Sophia and Friend