Love affair gone sour

Although E&P investment is set to rise, it is unlikely to reach forecast highs and other services-industry sectors are expected to witness a downturn. Services companies are not happy, complaining that oil companies are squeezing prices, reducing their profits, Helen Avati reports

ALL IS NOT WELL between the oil firms and the contractors that provide them with essential services. Consolidation in the oil industry in the past decade has greatly strengthened the bargaining power of the oil companies. The services suppliers that assist them in the discovery, development, production and transport of oil and gas and in the construction and maintenance of facilities complain that this has led to a squeeze on prices, severely cutting their profits, as well as to an unbalanced sharing of risks. At a recent Paris conference of the French oil technicians' association, players from both sides explained their ideas of a satisfactory relationship between operators and services com