Oilfield services giant SLB, formerly known as Schlumberger, is facing increasing pressure to exit Russia. The company asserts that its operations remain compliant with the new sanctions targeting Russia’s oil sector, which were introduced by the Biden administration.
During a conference call with investors, CEO Olivier Le Peuch mentioned that SLB is currently reviewing the recent sanctions but believes its activities align with the regulations. SLB has reported that contributions from its Russian operations account for around 4% of its global revenues in 2024, dropping from 5% the previous year, translating to approximately $1.4 billion.
Renewed scrutiny from U.S. lawmakers has emerged following the new sanctions, which aim to restrict the flow of petrodollars to the Kremlin amidst ongoing tensions due to the war in Ukraine. In October, a bipartisan coalition of over 50 members of Congress urged the Biden administration to impose stricter sanctions on U.S.-based oilfield service companies like SLB.
SLB stands alongside a few American oil companies still operating in Russia after the nation’s full-scale invasion of Ukraine in February 2022. Notably, its major competitors, Baker Hughes and Halliburton, divested their Russian assets to local managers last year.
Le Peuch assured analysts that SLB has proactively reduced its Russian operations, stopping shipments of products and technology from all its global facilities since 2023. He reiterated the company’s commitment to reviewing the new sanctions and believes their voluntary actions are compatible with these regulations.
Last year, an investigation revealed that SLB had entered into new contracts and was actively advertising for over 1,000 jobs in Russia, even as its competitors exited the market.
Oilfield services firms play a crucial role in the oil and gas industry, managing key operations from building infrastructure to executing complex drilling tasks. Analysts suggest that SLB’s continued presence in Russia may lead to future contracts from the Kremlin once the conflict in Ukraine is resolved and sanctions are lifted.
Human rights advocates and Ukrainian officials have voiced concerns that SLB’s ongoing work in Russia contributes to significant oil revenues that fund the Kremlin’s military efforts. In response, Ukraine’s National Agency on Corruption Prevention has classified SLB as an “international sponsor of war.”