Paying attention to Downstream Service Activities

Paying attention to Downstream Service Activities

by Pininvest Analysis

Oil services on pininvest.com

  • 24 constituents
  • -23.3% 1y performance
  • 64.7% volatility
Check the investment theme exit_to_app

By including industries relying on the OIl & Natural Gas Services value chain for only for a part of their revenue stream, our theme is not as pure a selection as the SPDR® S&P® Oil & Gas Equipment & Services ETF - the benchmark posted on our chart

The theme is less exclusively exposed to the Oil & Gas Drilling industry, critically impacted by the investment slowdown of exploration activities of the Oil Majors but when the expected trend reversal finally occurs, the benefit for our selection will also be more limited

The inclusion of infrastructure contractors, energy transportation and storage facilities favors downstream service activities

  •  infrastructure contractors are more diversified, and thus less exposed to the vagaries of the oil market - KBR (an offshoot of Halliburton) is a significant government contractor, Mastec is a specialist in power generation and transmission, Fluor is a global engineering and construction firm
  • transportation and storage are probable beneficiaries of what will potentially be the most significant development on world energy markets, the emergence of the United States as a major oil and gas producer and exporter - in the US, the pipeline infrastructure of Kinder Morgan dominates and for exports, storage companies as Vopak of the Netherlands positioned at the European entry port of Rotterdam should be considered

 

Our balanced approach of the Oil Services industry is a modest answer to uncertainties of international trade and global economic expansion (impacting oil demand)

Shortly, we will introduce a theme uniquely focused on oil drilling and exploration services to track  potential trend reversals in the industry