Oil exploration and production spend to cross $ 500 billion: Report

Reuters: Global exploration and production spending will likely rise about 16 percent this year to surpass the half-a-trillion mark for the first time, as companies look to capitalise on the rising demand for oil, Barclays Capital said on Monday.

The upcycle for exploration and production spending – expected to boost profits at oil services companies worldwide – is clearly underway and capital budgets have been raised substantially during 2011, the Barclays survey found.

The brokerage raised its budget estimate for spending in North America by 10 percentage points to 18 percent from its December view as there were a string of positive news from the U.S. Gulf of Mexico.

“We continue to believe that the major oil companies remain committed to the deepwater Gulf of Mexico and as permitting continues and improves, activity levels will ramp up,” Barclays wrote in a note to clients.

The note said the supermajors were already indicating large gains internationally and have modestly revised international budgets higher.

U.S.-based and Europe-based independents have recently revised their non-North American budgets dramatically higher.