SLB expects new offshore oil and gas activity above pre-pandemic levels

(Reuters) – Top oilfield services firm SLB (SLB.N) anticipates oil and gas offshore activity will surpass levels before the COVID-19 pandemic, as strong demand and pricing drive investment into the industry.

“We maintain the view that upstream spending is very resilient,” Chief Executive Olivier Le Peuch told investors at a conference in New York on Thursday, adding that he expects double-digit growth in energy sector capital investment in the coming years.

Oil prices this year climbed to their strongest levels in roughly eight years as Russia’s invasion of Ukraine led to disrupted energy supplies. Some economists fear rising energy prices could spark a global recession that cuts fuel demand.

However, SLB this year has benefited from increased oil drilling and production activity in North America and Le Peuch said he expects a resurgence in international business.

Shares were roughly flat in morning trading at $51.04, while Brent crude futures were down 1.73% to $94.47 a barrel. SLB’s shares are up at 70% year-to-date.

The company aims to grow its overall revenue by 15% annually through 2025 from 2021 levels, Le Peuch told investors.

Formerly called Schlumberger, SLB rebranded itself in late October with a new name, logo and color scheme to reflect an increasing focus on its digital business and commitments to a lower carbon future.

The company launched a New Energy business unit in 2020 and aims to generate $3 billion in revenue from that enterprise by the end of the decade, Le Peuch said. The business helps oil and gas customers reduce carbon emissions and develop cleaner fuels such as hydrogen.

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