O&M margins will stay lower for longer

Singapore

OFFSHORE and marine (O&M) margins are staying lower for longer - even with contracting activity picking up after oil held out above US$60, observers say.

M3 Marine's managing director Mike Meade said the industry at large is at best "putting on some meat on the bones".

Concurring, IHS Markit's Asia-Pacific head of research Ang Dingli projected that margins for yard groups, including Sembcorp Marine and Keppel O&M, will stay in the single-digit band through to 2020.

The picture is likewise not pretty in the offshore rig market, which serves as a barometer for the health of the larger O&M sector.

IHS Markit's data showed offshore rig day ra…