Company: TDDWW
Filing Date: 2025-08-04
Form Type: 10-Q
Source: 0001437749-25-024640
Chunk: 55

Company: TIDEWATER INC
Filing Date: 2025-08-04
Form: 10-Q
Item: Part I, Item 1
Chunk 55
---
 focus on returning value to shareholders within the major oil and gas companies, thereby limiting funds previously available for resource development; (vii) economies of major consuming nations; (viii) increased activism related to the perceived responsibility of the oil and gas sector for climate change; and (ix) more recently, U.S. trade policies that include substantial tariffs, causing increased market uncertainty and volatility. These factors, as well as numerous other regional conflicts in producing regions, have at various times caused or exacerbated significant swings in oil and gas pricing, which in turn has affected the capital budgets of oil and gas companies. Despite the volatility in spot oil prices seen in recent years, our customers tend to consider less volatile medium and long-term prices in making offshore investment decisions. In the medium term, we continue to see positive upstream investment momentum in both the international and domestic markets. We believe these markets are driven by resilient long-cycle offshore developments, production capacity expansions and increased resource exploitation activities. We have experienced a sustained period of growth in offshore exploration and production in the past few years, which has been accompanied by much higher levels of activity and higher day rates for our vessels.

Recent developments have introduced additional uncertainty to both the global economy and our business. In early April, OPEC+ announced plans to increase production starting in May, which caused oil prices to drop to the low $60s per barrel, compared to the first quarter 2025 range of $66 to $80 per barrel. Simultaneously, the U.S. declared numerous potential worldwide tariffs, further reducing oil prices and significantly lowering values across virtually every stock market globally. Within a week, most of these tariffs were rescinded for at least 90 days, leading to a partial recovery in both the market and oil prices. Then in June, the U.S., Israel and Iran had a brief, and intense, military conflict. Oil prices initially spiked, but returned to the mid $60s after a cease fire was negotiated. In early July, the US once again threatened significant tariffs on certain countries and OPEC+ announced a decision to accelerate its return of production to the market. Determining the long term impact of these tariffs and production increases on our business and the industry continues to be challenging. Offshore drilling projects are typically long-cycle and do not immediately react to moderate increases or declines in oil and gas prices. However, sustained oil prices in the low $60s per barrel, may delay some drilling projects initially expected