Schlumberger said annual sales will rise the most in 11 years as concern over inadequate energy supplies outweighs recessionary fears among major oil explorers.

Citing the biggest jump in demand for its services in more than a decade, the world’s biggest oilfield contractor sees sales reaching at least $27 billion this year, an 18% increase from 2021. Schlumberger shares climbed more than 8% after Chief Executive Officer Olivier Le Peuch predicted the uptrend in crude drilling is immune from economic contraction and has years to run. 

The rosy outlook for a sector recently battered by back-to-back oil busts capped a week of profit reports that included Halliburton Co.’s revelation that it’s nearly sold out of gear in the North American market and already is fielding inquiries from drillers looking ahead to 2023.  

“The multiyear upcycle continues to gain momentum with upstream activity and service pricing steadily increasing both internationally and in North America, resulting in a strengthened outlook for Schlumberger,” Le Peuch said in a statement Friday. “We are witnessing a decoupling of upstream from near-term demand volatility, resulting in resilient global oil and gas activity growth in 2022 and beyond.”

Oil explorers are expanding the search for crude on land and at sea in almost every corner of the globe. In the sector’s most bullish forecast yet, Schlumberger reinforced its view from three months ago when it alluded to the heady days of 2008, when crude prices ascended to dizzying heights and oilfield contractors posted some of their best results in history.

“We believe the accelerating international upcycle not only has multiple years to run, but will also unfold even if crude prices pull back modestly,” Scott Gruber, an analyst at Citigroup Inc., wrote in a note to clients. 

Spending by oil companies around the world is expected to grow 22% this year to $450 billion, according to James West, an analyst at Evercore ISI. That would rank 2022 as the fifth-biggest annual expansion in data going back to 1985.

Second-quarter profit of 50 cents a share, excluding certain items, was 10 cents higher than the average of estimates from analysts in a Bloomberg survey. Schlumberger’s new full-year outlook of more than $27 billion in sales exceeds the average estimate of analysts in a Bloomberg survey by almost $1 billion.

On a regional basis, quarterly sales climbed 20% in the US and Canada, and 12% elsewhere. For Schlumberger, it was the steepest quarter-on-quarter demand growth since 2010. The shares were up 7.5% to $36.14 at 9:54, bringing the year-to-date advance to more than 20%. The stock was the day’s second-best performer in the S&P 500 Index.

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Schlumberger, which is an industry bellwether because of its unmatched global footprint and extensive international order book, surprised investors three months ago with its first dividend hike since 2015. 

The hired hands of the oil patch are seeing a resurgence in business as the growing isolation of oil powerhouse Russia spurs activity in other crude-rich regions. Earlier this week Halliburton posted its biggest quarterly profit in four years, while Baker Hughes Co. reported better-than-expected sales and operating income in its oilfield-services segment, the company’s largest business unit.

Operators around the globe are expected to boost the number of wells drilled next year by 15% compared to this year, according to a survey by industry consultant Kimberlite LLC. The firm tallied 87% of onshore operators in North America and 68% in overseas explorers that plan to boost drilling budgets next year.