Halliburton’s profit rises with increase in oil prices

Halliburton (NYSE:HAL), the world's second-largest oilfield services corporation with presence in more than 70 countries, showed a quarterly profit of 54 percent on Monday. Halliburton made a wide decision by investing in developing oilfields like Texas’ Eagle Ford Shale and successfully pushed through the high oil prices during the quarter. Many other energy producers are following Halliburton’s footsteps and investing billions of dollars in such fields. Roger Read, A Morgan Keegan Analyst, said that increase in oil price was a significant component in company’s profit.

Halliburton’s Chief Executive and Chairman, Dave Lesar, said that “Reasons for company’s profit in North America through 2012 are the high oil prices, liquid-rich state of U.S land market as well as operators' improved cash flows combined with their ability to access capital. He added that activity boom is likely to stay beyond 2012. Halliburton’s net profit in second quarter jumped to $739 million with 80 cents per share from $480 million with 53 cents per share within a year. According to Thomson Reuters, company earned 81 cents per share exceeding the analysts forecast of 74 cents per share. 35 percent rise was seen in company’s revenue making it $5.9 billion which again topped analysts’ forecast of %5.71 billion.

Halliburton’s profit in the second quarter can be explained by its leading position in the pressure pumping technology. Pressure pumping technology helps oil and gas producers in tapping the shale fields. Halliburton is a market leader of this technology in North America. However, margins were bit slow outside North America. Halliburton commented that company’s profit outside North America were less than those expected. The Libya shutdown, delays in Iraq, sluggish markets in Britain and Algeria, rising sub-Saharan Africa costs etc are some of the causes for profit cut in international markets.