Business Outlook 2019

BUSINESS OUTLOOK 2019

5.1 Supply Chain Sentiment With an increase in capital commitments and expectations that operational expenditure has stabilised, there is a trend of improving sentiment and outlook within contractor companies. The OGUK Contractors Sentiment Survey indicates that 62 per cent of member companies have an improved outlook for 2019 compared to 2018, with only 12 per cent reporting a more pessimistic tone. However, this improved sentiment must be kept in perspective with industry only just beginning to emerge from one of its most difficult periods. With many areas of the supply chain still experiencing significant financial stress, further effort will be required to turn this increased optimism into sustainability.

Figure 23: Snapshot of General Sentiment Among Contractor Companies for 2019 Versus 2018

Much Higher

Higher

About the same

Lower

Much lower

Source: Oil & Gas UK

Source: Oil & Gas UK 5.2 Financial Performance Figure 24 outlines revenue by supply chain sector between 2010–17, the most recent data published by the EY Review of the UK Oilfield Services Industry . 12 Total supply chain revenue is shown to have fallen by almost one-third between 2014–17, from just under £40 billion to £27 billion, as E&P companies reduced costs and investment in the face of significant market challenges.

12 www.ey.com/uk/en/industries/oil---gas/ey-review-of-the-uk-oilfield-services-industry-january-2019

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