Schlumberger’s one-week returns against the industry
Schlumberger’s (SLB) one-week returns were -1.5% through March 2, 2018. Since February 23, 2018, the Energy Select Sector SPDR ETF (XLE) decreased 2.7%, and the VanEck Vectors Oil Services ETF (OIH) witnessed a -3.5% one-week return.
So, SLB outperformed OIH and XLE in the past week. SLB has also outperformed the SPDR S&P 500 ETF (SPY) since February 23, 2018. SPY has produced -2.0% returns in the past week. SLB accounts for 0.39% of SPY.
Crude oil price and rigs
On March 2, 2018, the West Texas Intermediate (or WTI) crude oil price was 3.6% lower compared to a week ago. Despite crude oil price’s weakness, three additional rigs came online in the US in the past week until March 2, 2018. You can read the latest about energy prices in Market Realist’s Is the Broader Market behind Your Energy Portfolio’s Losses?
Some recent factors that affected SLB’s returns
- The redeployment of additional pressure pumping fleet followed recent strong hydraulic fracturing activity in North America.
- Seasonal Wireline activity decline in Russia affected SLB’s returns.
- Higher project volume and increased service revenues in the Cameron group, led by OneSubsea, affected SLB’s returns.
- On February 21, 2018, SLB received a project award from upstream producer Noble Energy (NBL). SLB is expected to provide an engineering and supply contract for a process module to be installed on the Leviathan Platform in the Eastern Mediterranean.
- On February 23, 2018, SLB entered into negotiation to form a joint venture with Subsea 7 S.A. The joint venture is expected to be owned 50% by Subsea 7 and 50% by Schlumberger. The JV, if formed, is expected to strengthen the front-end engineering, design, and execution of integrated projects.
In this series, we’ll look at Schlumberger and its correlation with crude oil. We’ll discuss Schlumberger’s stock price forecast next.