Sasha Jovanovic
4 min read
Oil markets have snapped back into the spotlight after Brent crude hit about US$117 a barrel on fears of wider conflict around Iran, and that sudden price shock is reshaping risk and opportunity across global portfolios. Some businesses could see cash flow resilience or stronger pricing power, while others face higher costs and pressure on demand. This article walks through three stocks exposed to this news, outlining which may deserve a closer look and which might warrant more caution.
The three stocks below are only a first cut from this idea, and the full screen surfaced 13 more oil and gas producers and services companies with similarly detailed stories that are not covered here. To see the broader field and start to identify which tickers line up with your own risk and income goals, head straight into the Global Oil & Gas Producers and Oilfield Services screener
Precision Drilling (TSX:PD)
Precision Drilling fits this oil and gas services screen as a geared way to play onshore drilling activity. Its rigs, automation tools and support services are closely linked to how much work exploration and production companies choose to push through North American fields.
Precision Drilling generates most of its CA$1.9b revenue from Contract Drilling Services at about CA$1.6b, with Completion and Production Services contributing roughly CA$291 million. The stock carries a market value of about CA$1.7b.
Alpha digital tools, robotics and real time data systems that have already supported record low reported mechanical downtime in Canada and the U.S. create room for Precision Drilling to pursue a service model in which uptime and well performance become explicit pricing levers. This creates potential upside for net margins as contracts roll.
A key question for investors is what happens to Precision Drilling’s earnings power if a single unresolved financial overhang ends up redirecting cash that investors currently expect to support growth.
If that cash question is front of mind, read the full narrative for Precision Drilling to see how Precision Drilling’s balance sheet, contracts and capital plans could be shifting beneath the surface.
Noble (NE)
Noble is the pure offshore lever in this oil and gas screen, with its rigs tied directly to how hard producers push deepwater projects as energy security climbs the priority list.
Large offshore project pipelines in South America, West Africa and other regions are still expected to feed into ultra-deepwater drilling demand into 2027.
