Light at the End of the Tunnel


By James Careless


Oil and Gas Helicopter Operators Hope for Improvement


It wasn’t expected to happen: the world’s insatiable thirst for oil and gas should have ensured that more offshore oil rigs would always be needed, and that suppliers who supported those rigs – like helicopter companies – would always have a secure, stable market to serve.


But then it happened: oil prices unexpectedly plummeted “from a peak of $115 per barrel in June 2014 to under $35 at the end of February 2016,” stated the World Economic Forum website. “The sharp fall is broadly similar in magnitude to the decline in 1985-1986, when OPEC members reversed earlier production cuts, and in 2008-09 at the outset of the global financial crisis.”


When this article was written, a barrel of oil was worth $56.21, hardly a return to the triple-digit boom days before 2014. As a result, major offshore helicopter operators such as Bristow, CHC, and PHI continue to experience substantially less demand for their services compared to the pre-2014 good times, as does everyone who serves the offshore oil and gas industry.


“The oil industry has been in a cyclical downturn, and the offshore helicopter market has faced the same headwinds as the rest of the oilfield services markets,” said Steve Robertson, director at Westwood Global Energy Group, a consultancy that serves the global energy industry. The good news: “In 2019 we are now seeing signs of recovery and in most parts of the world, activity levels are growing again,” Robertson said.


76


Sep/Oct 2019


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