Halliburton Co., the world's second- largest oilfield services provider, said fourth-quarter profit more than doubled as higher crude prices and demand for drilling equipment boosted sales in North America.

Net income rose to $605 million, or 66 cents a share, from $243 million, or 27 cents, a year earlier, Halliburton said in a statement today. Excluding costs from a settlement agreement with Nigeria, the Houston-based company earned 5 cents more than the average of 33 analysts' estimates compiled by Bloomberg.

Sales climbed 40 percent to $5.2 billion.
"Extreme inflation" in the price of pressure-pumping services used to tap unconventional oil and natural gas widened margins compared with a year earlier, Scott Gruber, an analyst at Sanford C. Bernstein in New York, said in an interview before the results were announced.

Oil prices rose 12 percent to average $85.24 a barrel in the quarter, from $76.13 a year earlier. There were 3,227 active drilling rigs at the end of last year, up 29 percent from 2009.

The Obama administration in October ended a moratorium on new deep-water drilling in the Gulf, put in place after the BP Plc disaster, the biggest offshore oil spill in U.S. history.

The government has said it isn't delaying permits until the second half of this year.

Halliburton said it saw a quarterly loss from its Gulf of Mexico operations and may see "ongoing losses" there until the rig count recovers. It plans to maintain all of its infrastructure and most of its employees in the region while anticipating a rebound.

Eoin Treacy's view Oil in the region of $80 to $100 means that most oil fields are economically viable to one extent or another. In excess of $100, and as mentioned in the above piece, the price of oil becomes a liability and attracts the ire of regulators and politicians as well as representing a hurdle to economic growth for most economies; although this varies depending on the relative strength or weakness of their currencies.

European oil service companies have been some of the sector's better performers over the last year. Technip hit a new all time high in December but formed a large key reversal last week and is following through this week. A clear countermanding upward dynamic would now be required to question scope form a further pullback and consolidation of recent gains.

Petrofac also looks likely to pull back to test the medium-term progression of higher reaction lows and the ascending 200-day MA, currently near 1400p. Subsea 7, which completed its acquisition of Acergy three weeks ago, China Oilfield Services and Saipem also share the same characteristics.

Halliburton and Schlumberger have been consolidating above their 200-day MAs since late November, allowing them to partially unwind overbought conditions relative to their 200-day MAs. Sustained moves below $35 and $70 respectively would be required to question medium-term upside potential.

National Oilwell Varco has more than doubled since July and is now quite overextended relative to its 200-day MA. The pace of its advance has slowed somewhat of late and some additional consolidation of recent gains appears likely.

Baker Hughes has been something of a laggard and only broke to new recovery highs in December. It continues to improve on that performance and a clear downward dynamic would be required to check momentum beyond a brief pause