Owners and operators of offshore oil and gas assets have not seen light at the end of the tunnel for the severely depressed market, which continued to be marked by stunted activity levels and lingering overcapacity amid tame oil prices.
The stabilising oil price has seen a slight recovery in fortunes of Malaysian oil and gas (O&G) service providers such as UMW Oil & Gas (UMW-OG) which announced the award of its second jack-up rig contract in a week.
The better oil price environment seems to already be having a positive impact on some companies, with Brightoil Petroleum releasing a positive profit alert.
Offshore vessel owner Bourbon has increased its laid-up fleet to 104 vessels as activity in the deep and shallow water segments continued to decrease in Q4 2016.
A record high crude oil tanker delivery amounting to 5.5m dwt in January has instantly threw the sector's demand-supply out of balance and put pressure on freight rates, according to a latest report by Bimco.
China Oilfield Services Limited (COSL) has warned investors of a net loss of RMB11.7bn ($1.7bn) for financial year 2016 due mainly to lower work volumes on the slump in oil prices.
Moore Stephen’s partner Richard Greiner predicts that oil prices will continue to rise, there will be more calls to scrap ships, and the costs of meeting regulatory requirements will become clearer in 2017.
Global bunker fuel prices have approximately doubled over the course of 2016, rising from below $200 per metric tonne (pmt) to well over $300 pmt.
BW Offshore is targeting to reduce offshore staff costs by 10 – 15% as it reports a $7.3m net loss in for the first half of 2016.
Reporting fourth quarter losses of NOK161.1m ($18.6m), North Sea operator Rem Offshore warns of a bad market in the sector for years to come.