War-Related High Oil Prices Not Supporting SLB Revenue

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Written by Daniel Graeber for IIR News Intelligence (Sugar Land, Texas)

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Summary

Upstream services firm SLB reported that its Middle East revenue was diminished by war. At $100 per barrel, prices would otherwise be supportive of the bottom line.

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Market Recovery Uncertain, SLB Says

Though crude oil prices have been supported by war-related market shortages, upstream services firm SLB said first-half revenue from its Middle East portfolio was curtailed by operational issues.

According to Industrial Info Resources data, there is US$13.2 billion in projects involving SLB throughout the world.

A British maritime monitoring group reported this week that Saudi oil tankers were targeted off the coast of Yemen, where the Houthi rebel group draws on support from Iran. U.N. monitors have advised against traversing the Strait of Hormuz, which can carry roughly 20% of the global trade in crude oil and liquefied natural gas (LNG).

With attacks now in and around the Red Sea, maritime risks are only more severe. The price for Brent crude oil, the global benchmark, briefly topped $100 per barrel this week, after starting the month at around $70 per barrel.

For more information, see July 23, 2026, article Brent Hits $100, U.S. Oil Inventories Rise.

Saudi Arabia needs oil priced at around $90 to break even, while some shale drillers can do so with oil priced as low as $35 per barrel. Higher prices would normally incentivize upstream activity. But for SLB, it wasn't necessarily about break-even prices, but about activity. For the Middle East, that activity was curbed by fighting, with the company reporting a 4% decline in regional revenue from the first quarter and 14% year-on-year.

"While activity began to recover in certain countries during the second quarter, the timing of a full recovery remains uncertain and will depend on a durable resolution of the conflict," the company stated. "As activity improves, we expect the return to full production capacity to take time."

As recently as Thursday, the International Maritime Organization, the U.N. watchdog, said it was concerned about the impact of fighting on global commerce.

"Continued attacks on shipping in this region risk escalating tensions, further disrupting commercial routes and undermining the principle of freedom of navigation," Secretary-General Arsenio Dominguez said in a statement. "De-escalation is the only solution."

That's unlikely anytime soon. President Donald Trump told the Axios news service on Thursday that he was considering "a massive attack" on Iran, effectively nullifying the terms of a memorandum of understanding on ending the war.

By the Numbers

• 4% sequential decline in second-quarter revenue for SLB's Middle East portfolio
• 4% increase in revenue from North America

Work Cut out for Middle East Markets

SLB, meanwhile, continues to work in the Middle East, with a major focus on carbon-capture and storage projects in Saudi Arabia. It's also working alongside state-controlled entities in Iraq on developing the Akkas natural gas field in Anbar Province. IIR offers more information on the project in its Global Market Intelligence (GMI) Oil & Gas Production Project Database, where readers can find details--including construction schedules, investment values and necessary equipment--in a project report.

SLB's woes in the Middle East have been pervasive. The company reported net income from the region dropped 13% in the first quarter when compared to the same period in 2025. At the time, the company said it was impacted heavily by a decision from QatarEnergy to declare force majeure on exports of LNG and because of the shut-in of crude oil production in Iraq as a result of the lack of maritime transit.

Qatar could be out for as long as five years. IIR data show almost 20% of the 77 million metric tons per annum (MTPA) of LNG export capacity from the overall Ras Laffan North and Ras Laffan South facilities remains offline.

In North America, SLB reported a 4% increase in revenue from the first quarter and a 36% increase year-on-year.

Key Takeaways

• Higher oil prices aren't translating to energy-sector gains.
• SLB is waiting for the fighting to end, but it could be a protracted conflict.

About Industrial Info Resources
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, Industrial Info Resources is tracking over 250,000 current and future projects worth $30.2 Trillion (USD).