"The frack market “is a mess,” Brad Handler, an analyst at Jefferies LLC,
wrote in a note to clients. “With every passing datapoint/call, there
is little to suggest this market gets any better, and so we hack away at
numbers again.”
Shale Drilling's Worst Yet to Come
(Bloomberg) -- America’s biggest owner of drilling rigs fell the most
in seven months after the chief of Helmerich & Payne Inc. said he
called the bottom too soon.
Three months ago, when Helmerich had 220 of its rigs hired out, Chief
Executive Officer John Lindsay told investors the second quarter would
be the nadir for his fleet. But after the number of Helmerich rigs at
work shrank to 214 a few weeks ago, Lindsay says his earlier projection
was “premature.”
“The full effect of the industry’s emphasis on disciplined capital
spending continues to reverberate through the oil field services
sector,” he said in a Wednesday statement. “We are reluctant to predict
another bottom and see further softening during our fourth fiscal
quarter as our guidance would indicate.”
The hired hands of the shale patch who drill and frack wells are
suffering from a slowdown in North American spending brought on by
investor demands for higher returns. The U.S. oil rig count has fallen
11% this year, according to Baker Hughes.
Fracking giant Halliburton Co. is eliminating jobs and warehousing
equipment no one wants to rent. Superior Energy Services Inc. said
earlier this week that it’s looking for ways to cut costs and may sell
assets to raise cash. On Thursday, 28 of the 29 oil and gas industry
stocks in the S&P 500 Index were falling.
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OIL PRICES SIGNAL RECESSION?
