April 25 (UPI) -- Industry headwinds remain in some business segments because the global oil and gas sector hasn't fully recovered from 2016, Baker Hughes reported.
The company has reported steady gains in North American exploration and production figures, released as weekly rig counts. Spending on exploration and production plummeted last year after crude oil prices collapsed to below $30 per barrel, but the appetite for 2017 has improved since members of the Organization of Petroleum Exporting Countries agreed to cap production to offset supply-side strains.
The company reported a 15.3 percent decline in quarterly revenue to $2.26 billion as North American activity was not enough to compensate for lags elsewhere.
"While the onshore rig count increase in North America has been more robust than many had expected, the industry is still working to absorb excess service capacity," Chairman and CEO Martin Craighead said in a statement.
In its latest weekly report on rig activity, Baker Hughes reported a small gain in international counts for the week ending April 21, but figures were still lower than last year.
Rival services company Schlumberger posted a 3 percent decline in first quarter revenues earlier this week. Schlumberger Chairman and CEO Paal Kibsgaard said his company is still facing pressures from a weakened energy sector, but stressed that underlying sentiments seem to be that the global energy sector has bottomed out.
Baker Hughes had been a merger target with rival Halliburton, but aligned with the oil and gas division of General Electric. Craighead said growth was possible by the middle of this year as the new business transformation evolves.
"Looking forward to the rest of the year, we believe that the North America onshore market will continue to grow and service capacity will continue to be absorbed," he said. "For international onshore markets, activity has bottomed and we expect it will remain stable, with a few pockets of modest growth."