UK’s Wood Sees Slow Recovery In Oilfield Services Pricing

British oilfield services firm Wood Plc hit the top end of its forecasts for first-half profit in an improving global oil market, while warning its ability to raise prices was still limited to buoyant U.S. shale markets.

Shares in Aberdeen-based Wood rose 5%, initially topping gainers on the midcap FTSE 250, after it also raised its prediction of cost savings from its takeover of smaller rival Amec Foster in October 2017.

The company has seen demand for services recover in its core oil and gas market over the past two years as prices of crude tripled from 2016 lows, ending a period of aggressive cost-cutting by producers.

But CFO David Kemp told Reuters that improvement was still only slowly showing up in Wood’s ability to increase prices, with U.S. shale markets roughly six to 12 months ahead of the rest of the business.