Report: NOCs Stick To Cost-efficient Strategies As Oil Prices Rise

Rising oil prices have not caused national oil companies (NOC) to lose sight of the cost-efficient strategies that kept them afloat during the downturn like their non-state-owned counterparts.

Many NOCs will continue to spend cautiously as improving oil prices free up cash for more investment, higher production and growing operations outside their borders, according to a report released recently by Moody’s Investors Service.

“Even though strategies for each NOC depend on a number of factors such as the relationship with their national governments and prices in local markets, national oil companies overall have strived to cut costs, adjust growth strategies or sell assets as much as non-sponsored private oil companies have done,” Steve Wood, managing director for Moody’s oil and gas team, said in the report.

Moody’s took a look at how NOCs responded to falling oil prices and gave thoughts on how their actions—including altered policies and structures—could impact their future moves.