Halliburton executives recently discussed market conditions, the COVID-19 pandemic and Russia/Ukraine conflict. They said oil and natural gas prices continue to be impacted by the efforts to contain COVID-19, the pace of economic recovery, and changes to OPEC+ production levels.
In addition, Russia’s invasion of Ukraine in February and the ongoing conflict continues to cause regional instability. The foregoing destabilizing factors have caused dramatic fluctuations in global financial markets and uncertainty about world-wide oil supply and demand, which in turn has increased the volatility of oil and natural gas prices.
West Texas Intermediate (WTI) averaged approximately $109 per barrel during the second quarter of 2022. The U.S. land average rig count continues to be below pre-pandemic levels, but rose 13% in the second quarter of 2022 compared to the first quarter of 2022.
The Brent crude oil price averaged over $114 per barrel during the second quarter of 2022 and the international average rig count decreased 1% as compared to the first quarter of 2022.
Globally, Halliburton said it was being impacted by supply chain and labor shortages as the post-pandemic recovery stressed both the supply of raw materials and labor, plus transportation logistics.
“We monitor market trends and work to mitigate cost impacts through economies of scale in global procurement, technology modifications, and efficient sourcing practices. Also, while we have been impacted by inflationary cost increases, primarily related to frac sand, chemicals, cement and logistics costs, we generally try to pass much of those increases on to our customers and we believe we have effective solutions that work to minimize the operational impact,” the company stated.