- Order books have soared in the past year
- Hunting share price gains show investor eagerness
The swings and roundabouts of the oil and gas world continue with Middle Eastern spending more than balancing out weaker US demand for new equipment and services. UK investors could miss out on some of the proceeds, however, with Wood Group (WG.) back in takeover talks and Petrofac (PFC) desperately seeking a bailout from lenders. However, Hunting (HTG) is flying the flag, announcing two massive orders from Kuwait Oil Company (KOC) in the past month.
One analyst said this year had proved a turning point for the highly cyclical industry. “We continue to see a multi-year recovery in oil service margins, largely driven by increasing capacity utilisation,” said Alex Brooks at Canaccord Genuity last month. The top producer in the region, Saudi Arabia, may be cutting oil development spending, but is shifting cash into gas. Smaller producers such as Kuwait are also following this strategy.