The oil-price collapse is prompting the oil and gas energy and exploration sector to wind down expenditure in the continental US.
According to Industrial Motor Power Corporation, a new and used power generation supply company, it has already witnessed downward trends in oil and gas production in the US, a prophetic move guaranteed as a precursor to future cuts if prices don’t recover, the company says. Individual rigs have recently been cancelling orders in the triple figures, and this trend is likely to herald additional cost cuts yet to come, IMP believes.
Gregg Bare, of Mustang CAT based in Texas, observes: ‘Oil & gas is cutting back on everything. We’re getting a lot of cancellations, and delayed deliveries [on power generation equipment]. It’s a struggle for everyone, but the oil field is like that; it’s cyclical. A lot of smaller businesses might disappear, but everything will bounce back. It’s just a matter of time.’