Schlumberger, the world’s No1 oilfield services provider, said the oil price drop was likely to have a “significantly more dramatic” impact on North America than on the rest of the world.

Shares of Schlumberger, which derives two-thirds of its revenue from operations outside North America, rose as much as 5 per cent to $80.79.Brent crude prices have dropped nearly 60 per cent over the last six months, prompting oil and gas companies to slash capital spending and pull back rigs.

The impact on pricing and activity would, however, be less pronounced in international markets than onshore North America, chief executive Paal Kibsgaard said on a conference call, a day after the company said it would cut 9000 jobs in response to its customers’ spending cuts. Rivals Halliburton Co and Baker Hughes, which are less exposed to international markets, are merging in a $35 billion deal that is expected to boost their North America business to double that of Schlumberger’s.

Weak oil prices are widely expected to have a particularly severe impact on North America, where many shale fields are uneconomic at current oil prices of below $50 per barrel.

Kibsgaard warned that with the US land rig count down 400 rigs from October, activity reductions and pricing pressure would continue in the current quarter. Schlumberger, a technological leader in the industry, is counting on strength in Latin America and Middle East.

Spending in Middle East is expected to rise 14.5 per cent in 2015, according to Barclays estimates, while spending in North America is expected to fall at least 14.1 per cent.

Activity in Saudi Arabia had reached a “new record”, led by growth from a number of “key projects”, Schlumberger said.

“Saudi Arabia is the lowest cost producer on the planet ... they’re probably the best positioned to withstand (the fall in oil prices)”, said Tigress Financial Partners analyst Philip Van Deusen. Schlumberger, which reported a better-than-expected quarterly profit, is focusing on cutting costs by doubling asset utilization and increasing workforce productivity.

The company’s operating margin was likely to drop 6 per cent in the current downturn, compared with a 7.3 per cent fall in the 2009 downturn, Morningstar analysts wrote in a note.