As oil prices remain depressed due to increased supply, offshore drillers like Houston-based Diamond Offshore, Noble, Transocean and Tidewater suffered mightily during the first quarter of 2015.
For example, Houston-based Diamond Offshore’s stock price has dropped 27% since the beginning of the year.
But not all drillers have been hit quite as hard as Diamond.
Noble’s stock has dipped just 13% year to date while Transocean’s has dropped 20%.
Tidewater, on the other hand, has gotten hammered by a massive 41% plunge in value.
In a related story, offshore drillers are facing mounting pressure to trim down the size of their fleets by scrapping floaters.
In fact, within just the last 6 months, a whopping 32 offshore rigs have been designated for retirement.
To put in perspective just how major this development is, these are the first floater retirements in more than a decade.
And they are unlikely to be the last, according to Cowen’s J.B. Lowe and Roland Morris, as these are thought to be the “first steps” in what they expect to be a “massive supply reduction over the next two years.”
They went on to recommend that over 100 floaters should be removed from the supply in order to “balance the market.”
