OSLO, Norway, May 13 (UPI) -- One of the world's largest offshore service companies, Prosafe, said Wednesday oil market momentum could support demand in the second half of the year.
Prosafe, which has headquarters in Oslo, said its first quarter was supported by contract extensions and upgrades in Latin America and work off the British coast. Operating profit for the first quarter was $55.4 million, compared with $22.9 million year-on-year.
"The increase reflects a combination of a higher average day rate level and a higher utilization of the fleet," the company said in a statement.
The bear market for crude oil has forced some in the industry to scale back on their near-term investment forecasts. Norwegian energy company Statoil moved early in the downturn when scrapping a deal with rig company Transocean in November.
Transocean in a March said the offshore drilling market would "remain challenging" for the next couple of years.
The U.S. Energy Information Administration finds spending on exploration and production during the fourth quarter of 2014 was down 12 percent year-on-year.
Crude oil prices have rebounded above early 2015 lows below the $50 per barrel mark, though price movements have failed to sustain their momentum.
Nevertheless, Prosafe said that demand for services should improve, though development and production activity remained lower than in the past.
"In the latter part of the period, a positive movement in the oil price has been observed, and if sustained, could be expected to lead to a moderate increase in demand for offshore accommodation services," the company said.
