Oil Investment Hits a Multi-Year Low: What It Means for Energy Stocks

Oil services and equipment companies will be watching the upcoming third-quarter earnings season with a lot of interest. It's very difficult to predict where the price of oil and demand trends will be in the future. However, it's possible to get a good handle on the near-term outlook for services and equipment companies by looking at the capital spending plans of the major oil companies. In this context, let's take a look at the evolution of their capital spending plans in order to gauge trends and focus on what to look out for in the reports.

Unfortunately, the near-term outlook is not good, and there could be some near-term disappointments. It's well known that the COVID-19 pandemic caused many oil exploration and production companies to cut spending plans, not least because end demand got destroyed with the lockdown measures imposed on the economy. However, it's worth pointing out that spending plans continued to be cut in the second quarter as well.

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Source Fool.com