Even though the oil and gas industry remains in a tough economic climate, some leading companies believe that better days are ahead.
One of those companies is the world’s largest oil field service company, Schlumberger. Just last week Schlumberger said it sees recovery in many regions of the world.
“The only place where we don’t see any signs of recovery at this stage is in Asia,” Chief Executive Paal Kibsgaard said.
Schlumberger said it expects “solid growth” in 2017 in the Middle East, Russia and North America.
In Texas, some economic signs of stability were insufficient to halt the decline in the Texas Petro Index, a composite index of economic indicators in Texas. The TPI declined for the 22nd consecutive month to 149.0, two-thirds of its value in September 2015.
“I was hoping the TPI was going to post its first monthly increase in September,” economist Karr Ingham, the author of TPI, said. “But the upstream recovery remains a slow process.”
Ingham said that absent a rapid expansion of demand that would help absorb the current crude oil oversupply, any solution to market imbalance must come from the supply side of the ledger. With OPEC members and Russia apparently unable to agree on a plan to curtail oil output, U.S. production needs to continue declining to provide upside support to crude oil prices, he said.