Oil-service companies continue to prosper and expand, according to speakers at a forum sponsored by consulting firm RMI in Houston. The number of rigs operating around the world grew 14% this year, bringing the total to 2,948. This is a continuation of the previous year's increase of 15%. Growing consumption of hydrocarbons, especially in the U.S., China and former Soviet Union, is driving demand. "As long as we drive cars, you have to be bullish on oil," said Jim Wicklund, managing director and senior equity research analyst for Banc of America Securities. Wicklund recommended that contractors seize the current opportunity to recapitalize rig fleets when payback is guaranteed by customers. Also, operators should not to get too comfortable with oil demand, since many producers, including ExxonMobil, see gas becoming the more important hydrocarbon in the next 10 years. For more on this, see the December issue of Oil and Gas Investor. For a subscription, call 713-260-6441.

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