Iran War Disrupts Oilfield Services as Companies Brace for Earnings Hit
Oilfield services companies are bracing for a hit to earnings due to the Iran war disrupting energy infrastructure across the Middle East and producers holding back on new drilling until higher oil prices prove durable.
The Brent benchmark has surged 53% since February 27, but security risks and infrastructure damage have sent activity plummeting in one of the world's top energy-producing regions.
According to Rystad Energy, the offshore rig count has fallen by about 39% to 72 rigs in the Gulf as of March 27, with idled rigs in the Gulf, slower crew mobilizations, and rising logistics and insurance costs disrupting operations.
Industry bellwether SLB expects first-quarter revenue below expectations and a 6-9 cent-per-share earnings hit after suspending travel and demobilizing operations in the Middle East.