Maersk Drilling Sees Rig Overcapacity Lasting for ‘Foreseeable Future’

Maersk Guardian

As much as one third of the global offshore fleet of oil drilling rigs could be idled in 2016 as energy firms scale back investments on the back of weak crude prices, the head of Danish conglomerate A.P. Moller-Maersk’s rig unit said on Thursday.

“I would probably estimate that we have in 2016 between 25 percent to one third of the fleet suffering from idle times,” Maersk Drilling Chief Executive Claus Hemmingsen told Reuters.

“The current outlook for the oil companies bringing new projects to the market is very uncertain and not very optimistic … there will be oversupply in the foreseeable future,” he added.

Shares of some independent rig owners such as Norway’s Seadrill have dropped by more than 90 percent in the last two years as the price of crude plunged by around three quarters.

[reuters]

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