Water midstream on the ropes as pandemic fuels oil price crash

摘要

Lower production volumes and a squeeze on service fees could result in a 40% year-on-year reduction in US oilfield water management revenues in 2020, according to new projections from investment bank Raymond James. The combined effect of the oil price war and the coronavirus pandemic is severely affecting US shale oil producers, many of which were already burdened by debt and budget constraints. The severe price drop (see chart below) has driven many operators to slash 2020 capex budgets and drilling programmes as they look to maintain free cash flow and continue servicing debt.