Oil services company John Wood Group has said that operating profit could plunge 20% this year as the falling price of crude continues to hit producers and explorers.
The company said that market conditions “remain challenging in 2016”, despite recent gains in the price of oil.
The price of Brent crude has risen 22% this year, but is still priced at just $45 a barrel.
John Wood, which provides specialist equipment to oil producers and is Britain’s largest oil services firm, said in a trading statement: “Market conditions remain challenging in 2016 and we have seen further margin pressure in an environment of expected lower activity by operators.
“We anticipate that full year EBITA (earnings) will be around 20% lower than 2015, in line with current analyst consensus expectations.”
It added that it remains focused on cutting costs and improving efficiency so that it is well positioned “for when market conditions recover”.