Oil and gas executives think the industry downturn is on its way out for producers and drillers, but may be getting worse for pipeline companies.
As FuelFix.com reports, Deloitte says almost two-thirds of the industry professionals contacted for the consulting firm’s annual oil and gas survey believe the recovery has already begun, or will next year.
Companies are still focused on cutting costs. But executives expect oil prices to rise, capital expenditures to increase and hiring to rebound over the next year.
“If last year was the year of hard decisions, 2017 will be the slow road back,” says John England, Deloitte’s vice chairman and U.S. and Americas oil and gas leader.
At the same time, survey respondents thought the downturn was moving to pipeline companies.
Severe cuts to exploration and production company spending are beginning to wear on pipeline firms, “once thought to be somewhat immune from commodity price volatility,” says Andrew Slaughter, managing director of the Deloitte Center for Energy Solutions.
Pipeline contracts also are now being renegotiated or challenged in bankruptcy court by troubled exploration and production companies, Slaughter says.
Almost two-thirds of the pipeline executives surveyed expected a “moderate level” of company consolidation this year and next.
Read the full 2016 Oil and Gas Industry survey.
