Dallas Fed: Business Activity for OFS Highest It's Been In 5 Quarters
Business activity for oilfield services companies increased in 2Q 2017 to its highest reading since 1Q 2016, according to findings from the Federal Reserve Bank of Dallas’ quarterly energy survey, released June 28.
Survey respondents represented 138 energy firms (70 E&P and 68 oilfield services) in the Eleventh District (Texas, northern Louisiana and southern New Mexico).
Labor market indexes overall (for oil and gas exploration and production firms and oilfield services firms) increased. This includes rising employment, employees hours, wages and benefits. Employment growth was driven by oilfield services firms.
Through a set of special questions, the survey also revealed:
- 67 percent of respondents expect the oil market to come into balance in 2018 or sooner
- 55 percent of respondents believe OPEC will continue to limit its oil production beyond March 2018; 45 percent believe OPEC will not
- On average, respondents expect OPEC will produce 32.3 million barrels of crude oil per day in 2H 2017
- 87 out of 115 executives said they are looking to use their internal cash flow to finance increased activity
On average, respondents expect WTI crude oil prices will be $48.79 at year-end. This projection is lower than the Dallas Fed 1Q 2017 survey, in which respondents expected the price to be 453.49. WTI crude oil closed at $44.24 per barrel June 27.
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