Company: TDDWW
Filing Date: 2025-02-27
Form Type: 10-K
Source: 0001437749-25-005487
Chunk: 209

Company: TIDEWATER INC
Filing Date: 2025-02-27
Form: 10-K
Item: Item 1B
Chunk 209
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Oil and gas prices are affected by a host of geopolitical and economic forces, including the fundamental principles of supply and demand. Offshore oil and gas exploration and development activities often require higher oil or gas prices to justify the higher expenditure levels of offshore activities compared to conventional onshore activities. Prices are subject to significant uncertainty and, as a result, are extremely volatile. Over the past several years, oil and gas commodity pricing has been affected by (i) a global pandemic, which included lock downs by major oil consuming nations; (ii) an ongoing war in eastern Europe between Russia and Ukraine, which includes sanctions on Russian oil production; (iii) an Israeli/Palestinian conflict that has resulted in disruption of shipping in the Middle East; (iv) Organization of the Petroleum Exporting Countries Plus (OPEC+) production quotas, market share expectations and pricing considerations; (v) resource growth in non-OPEC+ nations; (vi) capital allocation and discipline within the major oil and gas companies thereby limiting funds previously available for resource development; (vii) economies of major consuming nations; and (viii) increased activism related to the perceived responsibility of the oil and gas sector for climate change. 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. We expect 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 are one of the world’s largest operators of offshore support vessels and we have operations in most of the world’s offshore oil and gas basins. We have also pursued opportunities in the sustainability arena, including the support of offshore wind energy generation, and continue to invest in our fleet to improve performance, increase efficiencies and reduce our emissions and environmental impact.

We have experienced a sustained period of growth in offshore exploration and production in the past two years which has been accompanied by much higher levels of activity and higher day rates for our vessels. However, some customers have recently paused or delayed additional activity on some drilling projects, for a number of reasons, including logistical and supply chain bottlenecks, further evaluation of exploration results and longer than anticipated finalization