By Kamarul Yunus
KUALA LUMPUR — Oil support services companies are facing problems securing bank loans, said the head of its industry body, based on initial checks.
The Malaysian Oil and Gas Services Council (MOGSC) will carry out a survey to gauge the effects of the current downturn on its members, president Sofiyan Yahya said.
“From that we will know the full impact on our members,” he said.
Currently, there are some 150 oil and gas services companies registered with MOGSC. These include names like SapuraCrest Petroleum Bhd and Scomi Group Bhd.
Sofiyan said the government must ensure that banks make credits available, although they are more careful about lending in reaction to the worldwide financial crisis.
“We must make sure that the oil and gas sector does not diminish in the face of the worldwide downturn,” he told a media conference in Kuala Lumpur yesterday.
Noting that oil and gas is a business with a longer-term outlook, Sofiyan said investment and expenditure within the industry must not fall but actually grow.
“If done right, the effect to the fundamentals of our oil and gas engine will be strengthened and the sustainability for the future growth of our economy,” he said.
On the price of crude oil, Sofiyan said MOGSC expects the price to rise, based on the expectation by the Organisation of Petroleum Exporting Countries that the price of the commodity would rise between US$60 and US$80 (RM216.6 and RM288.8) barrel per day.
“But it is difficult to ascertain where the price would be heading as we have to take into consideration various factors such as production costs, energy demand as well as the stock level,” he said.
(c) 2009 New Straits Times