6th Sep 2018 10:48
LONDON (Alliance News) - FTSE 250-listed engineering company Weir Group PLC said on Thursday that demand for original equipment softened during the month of August, and some order book deliveries had been deferred.
This followed the announcement from US oilfield service provider Schlumberger Ltd, who warned on Tuesday that a surge in oil and gas production in the Permian basin of west Texas had outstripped transport capacity, leading to a drop in the oil price and could also threaten to reduce the amount of drilling activity.
Brent oil is currently quoted at USD77.62 a barrel, marginally higher from USD77.29 at the London close on Wednesday.
The company makes pumps and valves and sells them into the mining and oil and gas sectors and is therefore sensitive to movements the commodities and mining sectors.
Weir said there had been a "considerable softening" in demand for equipment in the last two weeks of August. Compounding its troubles, Weir added that it had experienced some "deferrals" on orders.
Shares in Weir Group were down 6.2% at 1,675.28 pence, among the worst performers in the FTSE 250 on Thursday.
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