Baker Hughes sees ‘solid’ upstream spend in '24: Update

Market: Crude oil, Natural gas
26/10/23

Updates with details from analyst call.

Oilfield services and technology company Baker Hughes expects another year of "solid" upstream spending growth in 2024, led by international and offshore markets, in spite of growing geopolitical risks.

"Higher hydrocarbon prices do provide positive momentum into operators' development plans," chief executive officer Lorenzo Simonelli told analysts.

Spending on international drilling and completions is set to increase this year "in the mid-teens" while North America is poised to see growth in the "mid-to-high single digits."

"We expect this upstream spending cycle to be more durable and less sensitive to commodity price swings relative to prior cycles," Simonelli told analysts.

The company reported a profit of $518mn in the third quarter, compared with a loss of $17mn in the same period last year. Revenue increased 24pc to $6.6bn.

"Continued discipline from the world's largest producers, the pace of oil demand growth in the face of economic uncertainty, and geopolitical risk will be important factors to monitor as we look into 2024," said Simonelli.

Baker Hughes said the global LNG market remains tight, as seen by recent price spikes due to the conflict in the Middle East and strikes in Australia.

Global LNG demand this year is set to approach 410mn t/yr, up about 2pc from 2022, according to the company.

While Simonelli recognized there is a growing consensus that the energy transition will likely take longer than some had expected, he noted that the company's "unique portfolio is set to benefit irrespective of the pace of development."

Baker Hughes is the last of the three biggest oilfield services companies to report third-quarter results, coming after SLB and Halliburton.

By Stephen Cunningham

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London, 3 May (Argus) — A core group of eight Opec+ members has agreed to accelerate, for a second consecutive month, their plan to unwind some of their production cuts, the Opec secretariat said Saturday. As it did for May, the group will again raise its collective output target by 411,000 b/d in June, three times as much as it had planned in its original roadmap to gradually unwind 2.2mn b/d of crude production cuts by the middle of next year. The original plan envisaged a slow and steady unwind over 18 months from April, with monthly increments of about 137,000 b/d. But today's decision means that the eight — Saudi Arabia, Russia, the UAE, Kuwait, Iraq, Algeria, Oman and Kazakhstan — will have unwound almost half of the 2.2mn b/d cut in the space of just three months. The decision to maintain this accelerated pace into June is somewhat surprising, given the weakness in oil prices and the outlook for the global economy. The eight's decision last month to deliver a three-in-one hike in May was seen as a key reason for the recent slide in oil prices, alongside US President Donald Trump's tariff policies. Front month Ice Brent futures have fallen by about $13/bl since early April to stand at just over $61/bl. But the eight today pointed to "current healthy market fundamentals, as reflected in the low oil inventories" as a key factor in its latest decision. It reiterated, as it has in the past, that the gradual monthly increases "may be paused or reversed subject to evolving market conditions." As was the case for May, delegates said that the main driver for the June hike was again a desire to send a message to those countries that have persistently breached their production targets since the start of last year — most notably Kazakhstan and Iraq, which each have significant overproduction to compensate for through the middle of next year. "This measure will provide an opportunity for the participating countries to accelerate their compensation," the secretariat said. This group of eight is due to next meet on 1 June to review market conditions and decide on July production levels. By Nader Itayim, Aydin Calik and Bachar Halabi Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Opec+ eight to agree another accelerated hike for June

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03/05/25

Opec+ eight to agree another accelerated hike for June

London, 3 May (Argus) — A core group of eight Opec+ members look set to today to accelerate, for a second consecutive month, their plan to unwind some of their production cuts, four delegates told Argus . As it did for May, the group would again raise its collective output target by 411,000 b/d in June, three times as much as it had planned in its original roadmap to gradually unwind 2.2mn b/d of crude production cuts by the middle of next year. The original plan envisaged a slow and steady unwind over 18 months from April, with monthly increments of about 137,000 b/d. But today's decision would mean that the eight — Saudi Arabia, Russia, the UAE, Kuwait, Iraq, Algeria, Oman and Kazakhstan — will have unwound almost half of the 2.2mn b/d cut in the space of just three months. The decision to maintain this accelerated pace into June would be somewhat surprising, particularly given the weakness in oil prices and the outlook for the global economy. The eight's decision last month to deliver a three-in-one hike in May was seen as a key reason for the recent slide in oil prices, alongside US President Donald Trump's tariff policies. Front month Ice Brent futures have fallen by about $13/bl since early April to stand at just over $61/bl. While Opec+ has said that it is acting to support an expected rise in summer demand, the decision to speed up the output increases once again appears to be driven by a desire to send a message to countries that have persistently breached their production targets — most notably Kazakhstan and Iraq. By Aydin Calik, Bachar Halabi and Nader Itayim Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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