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Halliburton on Tuesday warned of the impact of second-quarter revenues from tariffs and lower oilfield activity in North America as producers assessed drilling and completion on weaker oil prices and reduced shares in oilfield service producers by about 6%.
Halliburton is one of the first large oil companies in the US to report revenues as US crude prices are under $64 a barrel. Many companies say that oil prices are less than $65 a barrel and can’t drill profitably if they dent the demand for equipment and services offered by companies like Halliburton.
“Many of our customers are evaluating activity scenarios and evaluating plans for activity reductions in 2025, which could mean that they are higher than normal blanks due to a dedicated fleet or, in some cases, a fleet’s retirement or export.” The white space refers to the calendar gap when the company is not lined up for its equipment.
Halliburton is one of the first large oil companies in the US to report revenues as US crude prices are under $64 a barrel. (Reuters/Richard Carson/Reuters Photos)
Harriburton shares fell about 6% at $20.62 per share after forecasting a 2-3 cent impact from trade tensions from the second quarter. LSEG data showed revenues for the second quarter were estimated at 63 cents per share.
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Stocks fell by 10% during the session, down 24% since the start of the year. Shares in rival SLB fell just 11% this year.
The oilfield services sector is concerned about President Donald Trump’s tariffs on imported steel and parts. It disrupts the supply chain and reduces equipment costs such as drilling rigs and well casings.
| Ticker | safety | last | change | change % |
|---|---|---|---|---|
| Hal | Halliburton co. | 21.92 | -0.61 |
-2.71% |
The company also acquired $107 million in retirement costs in the first quarter. Halliburton, which also cost $63 million in retirement costs in the third quarter of 2024, did not immediately respond to requests for details on their retirement claims.
Halliburton said its first quarter North American revenue was $2.2 billion, down 12% year-on-year.
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International revenues eased by 2%, primarily due to declining drilling and project management activities in Mexico. It predicts a slight decline in international revenues from the previous year.
Mexico has struggled to propose a new contract model for the oil sector and pay accumulating billions of dollars in debt to oil services companies. In the meantime, state Pemex’s oil production has continued to decline to about 1.62 million bpd this year, compared to 1.76 million bpd last year.
Halliburton employees work on Monday, June 26, 2017 at three wellhead fracking sites in Midland, Texas. (Photo by Steve Gonzales/Houston Chronicle via Getty Images/Getty Images)
“I think they have a plan, but I think it’s going to be difficult for a while… It won’t recover anytime soon in Mexico,” Miller said.
Halliburton forecasts completion and production revenues, up 1% to 3% from the first quarter, with margins almost flat. Revenues in the drilling and valuation sector were expected to decline by 2%. The margin was set to lower the base point from 125 to 175.
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The Houston-based company recorded profits of less than $666 million or 68 cents per share for the three months ended March 31st.
Excluding the $356 million pre-tax fee, including retirement benefits, the company recorded an analyst estimate and an inline profit of 60 cents.
The revenue of $5.42 billion is an average analyst estimate of $5.28 billion.
