Yahoo Finance How Did the Offshore Drilling Industry Fare in May?
Will Rising Oil Prices Brighten Outlook for Offshore Drillers?
A mixed bag for offshore drillers
May was a mixed bag for offshore drilling investors. Some stocks traded in the positive territory while others traded in the negative territory. Oil prices hit the $50 per barrel level for the first time in 2016. However, the industry also faced many contract terminations.
Stock performance of offshore drillers
The following is a summary of the stock price movement for offshore drillers (XLE) so far this month as of May 25:
Pacific Drilling (PACD) fell by 32%.
Transocean (RIG) fell by 9%.
Atwood Oceanics (ATW) rose by 20%.
Noble (NE) fell by 22%.
Ensco (ESV) fell by 16%.
Rowan Companies (RDC) fell by 8%.
Seadrill (SDRL) fell by 29%.
1Q16 earnings
Almost all the offshore drilling companies released their first quarter results in May. For more information, read Market Realist’s earnings reports on Pacific Drilling, Ensco (ESV), Rowan Companies (RDC), and Diamond Offshore (DO).
Series focus
As crude oil prices rose to $50 in May, it’s important to see whether the underlying fundamentals of the industry have changed. Have the rig counts and utilization rates also increased with the increase in oil prices? Have more drilling permits been issued this month? Have the valuations of the industry changed along with stock prices? We’ll answer all these questions in this series. Also, we’ll look at where these indicators could head in the coming months. In the next article, we’ll look at the impact of oil prices on the offshore industry.
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