(Source: "China Petroleum News" 2026-03-13)
On March 11, member states of the International Energy Agency unanimously agreed to release 400 million barrels of strategic oil reserves to deal with the tight global oil supply caused by the US and Israeli military attacks on Iran. As a key link in the oil and gas industry chain, the ripples of oil market fluctuations are being transmitted to oil service companies. Amid the storm, what is the industry’s outlook? Can oilfield services companies gain a foothold? Many experts said that partial pressure may be unavoidable in the short term, but in the long term, the overall development of the oilfield services industry is highly resilient and operating fundamentals remain solid.
Short-term impact has become a reality, and bargaining power may be differentiated
As the core global traditional oil and gas production area, the Middle East has a large demand for oil services companies. Many experts said that due to the current impact of geopolitical factors, oilfield service projects in the region are facing varying degrees of challenges such as operational restrictions, personnel evacuation, and project suspensions. In the short term, corporate revenue and project progress are under pressure. According to relevant insiders at Schlumberger, many of its Middle East businesses have been affected. If the situation continues for a long time, global resource allocation will need to be re-evaluated. Under the current background, the bargaining power of oilfield service companies presents a situation where "mechanism constraints" and "technological premiums" coexist.Dong Xiucheng, Director of the Belt and Road Energy w88 and Development Research Center at the w88 casinoThe analysis pointed out: "Theoretically, rising oil prices may drive upstream oil companies to increase profits, thereby increasing investment in oil services companies. But in reality, this transmission still depends on the budget arrangement and decision-making mechanism within the oil group." Li Guoqiang, deputy manager of the production department of CNPC's well logging market, believes that in the context of significant increases in safety risks and operating costs, oil services companies with core technologies and professional service capabilities will have a stronger initiative in project negotiations.
Looking into the long term, the industry’s operating fundamentals remain solid
With a global focus, the market structure is being restructured at an accelerated pace. The Strait of Hormuz is restricted, oil and gas exports to the Middle East are blocked, and energy security demands may push countries to adjust their supply layout. Li Guoqiang said: "The obstruction of projects in the Middle East may prompt energy importing countries to accelerate the pace of local oil and gas exploration and development to ensure their own supply security. This has opened up new market space for global oil services companies." Guo Haitao, director of the Institute of Energy Economics and Finance of China University of Petroleum (Beijing), pointed out that the pattern of global oil and gas resources and demand has not changed. Other resource countries will not reduce development due to local conflicts. Instead, they may increase supply due to market fluctuations in order to gain more shares, which is a structural benefit to the oil services industry. Based on the domestic market, increasing reserves and production will build a solid “ballast stone”. Facing external uncertainties, the “basic market” of domestic oil and gas exploration and development is becoming a reliable support for oil services companies. The country has clearly set out the goal of building an energy powerhouse, and has further promoted major projects such as a new round of mineral prospecting breakthrough strategic actions and deep sea, deep and polar exploration; PetroChina has implemented two major strategic tasks: the "reservoir-production ratio stabilization project" and the "enhanced oil recovery ballast stone project". "This provides strong policy support and market guarantee for oilfield service companies." Li Guoqiang said, "In addition, the new scenarios brought about by the integrated development of domestic new energy and oil and gas industries have further consolidated the development foundation of oilfield service companies."
Facing the future, only by adapting to "change" can we achieve steady and long-term progress
The wind is high and the waves are strong, which makes us more resilient. In the face of oil market fluctuations and geopolitical risks, how can oilfield services companies seek changes on their own so that they can gain a foothold in the volatile market? First, optimize the global market layout and enhance risk resistance. As geopolitical uncertainty rises, companies should avoid over-concentrating their operations in a single region. "We must not only deeply cultivate the resource-rich area in the Middle East, but also actively expand emerging markets and build a global layout of 'multi-point support and dynamic balance'." Guo Haitao said. The second is to seize the opportunities of energy transformation and expand new business boundaries. Li Guoqiang suggested that we should focus on emerging business areas such as new energy, associated minerals, and CCUS, promote the diversified transformation of the business structure from traditional oil services to "oil services + new energy", and cultivate new profit growth points. The third is to focus on core technology research and replace scale competition with technical barriers.Dong Xiuchengbelieves that the traditional oilfield services enterprise’s “asset-heavy, equipment-focused” model is no longer able to adapt to the new situation, and must transform into “asset-light, high-tech services” to achieve differentiated competition by mastering high-end technology. The fluctuations in the oil market never stop, and true stability lies in finding new growth points in every impact. The storm is still going on, and only by continuously cultivating internal strength can oilfield service companies gain a firm foothold in the uncertain changes.
Attachment: Original link
