Halliburton 2013 Annual Report Download - page 40

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24
BUSINESS ENVIRONMENT AND RESULTS OF OPERATIONS
We operate in approximately 80 countries throughout the world to provide a comprehensive range of discrete and
integrated services and products to the energy industry. A significant amount of our consolidated revenue is derived from the
sale of services and products to major, national, and independent oil and natural gas companies worldwide. We serve the
upstream oil and natural gas industry throughout the lifecycle of the reservoir, from locating hydrocarbons and managing
geological data, to drilling and formation evaluation, well construction and completion, and optimizing production throughout
the life of the field. Our two business segments are the Completion and Production segment and the Drilling and Evaluation
segment. The industry we serve is highly competitive with many substantial competitors in each segment. In 2013, 2012, and
2011, based on the location of services provided and products sold, 49%, 53%, and 55% of our consolidated revenue was from
the United States. No other country accounted for more than 10% of our revenue during these periods.
Operations in some countries may be adversely affected by unsettled political conditions, acts of terrorism, civil
unrest, force majeure, war or other armed conflict, expropriation or other governmental actions, inflation, foreign currency
exchange restrictions, and highly inflationary currencies, as well as other geopolitical factors. We believe the geographic
diversification of our business activities reduces the risk that loss of operations in any one country, other than the United States,
would be materially adverse to our consolidated results of operations.
Activity levels within our business segments are significantly impacted by spending on upstream exploration,
development, and production programs by our customers. Also impacting our activity is the status of the global economy, which
impacts oil and natural gas consumption.
Some of the more significant determinants of current and future spending levels of our customers are oil and natural
gas prices, the world economy, the availability of credit, government regulation, and global stability, which together drive
worldwide drilling activity. Our financial performance is significantly affected by oil and natural gas prices and worldwide rig
activity, which are summarized in the following tables. Additionally, due to improved drilling and completion efficiencies as
more of our customers move to multi-well pad drilling, our financial performance is impacted by well count in the North
America market.
The following table shows the average oil and natural gas prices for West Texas Intermediate (WTI), United Kingdom
Brent crude oil, and Henry Hub natural gas:
2013
2012
2011
Oil price - WTI (1)
$
97.99
$
94.15
$
95.13
Oil price - Brent (1)
108.71
111.60
111.53
Natural gas price - Henry Hub (2)
3.73
2.81
4.09
(1) Oil price measured in dollars per barrel
(2) Natural gas price measured in dollars per thousand cubic feet, or Mcf