What Lower Oil Prices Mean for Equipment Makers

The transcript discusses the impact of declining oil prices on companies like Baker Hughes and Schlumberger. It highlights transitory issues faced by Baker Hughes, such as weather impacts, and examines the broader implications of oil price fluctuations on cash flow and project economics. Despite a projected slowdown in spending, the transcript suggests that stock valuations remain attractive. It also explores the challenges faced by non-conventional and deepwater projects, with a focus on companies like Halliburton and Baker Hughes.

What was one of the transitory issues affecting Baker Hughes' performance in the recent quarter?

• Supply chain disruptions

• Weather issues in the Gulf of Mexico

• Regulatory changes

• Labor strikes

How does a decline in oil prices affect EMP companies?

• It increases their cash flow

• It reduces their project economics

• It has no impact on their spending

• It leads to higher stock valuations

What is the expected average oil price range for 2015 according to the transcript?

• $60 to $70

• $75 to $80

• $85 to $90

• $95 to $100

Which companies are most leveraged to US non-conventional plays?

• Total and Eni

• Halliburton and Baker Hughes

• BP and Shell

• ExxonMobil and Chevron

What recent improvement did Baker Hughes report in their North American business?

• Expansion into new markets

• Higher rig rates

• Increased labor force

• Pricing improvement in pressure pumping