In addition, about one third expect oil prices to improve this year.

"The industry is on a balance point," said Paul Doucette, global leader for public policy and external funding at GE Oil & Gas. "Companies are trying to decide where the new normal is."

The outlook varied markedly by industry sector. Half of respondents from operators are confident about prospects for the coming year, but only one quarter of manufacturers share their view. Respondents at larger companies were also generally more confident than those at small or midsize firms, by a margin of about 15 percentage points. North American respondents were also much more bullish than others, with about 65 percent expecting improvement this year versus 40-45 percent of respondents in other regions — a reflection of the lower development costs for onshore U.S. drillers.

Price expectations remain low

Most respondents expect that oil prices will not rise significantly in 2017, due in large part to an oversupply of crude. Nearly two thirds believe that supply will outpace demand this year, despite the recent OPEC agreement.

Ye Hua Huang, deputy director-general at the China National Offshore Oil Corporation (CNOOC) Bohai Oilfield Bureau, told DNV that “the actual amount of production cut will still depend on whether producers abide by what they have agreed on. The cut could also be overshadowed by any increase in production by non-OPEC members.” With new production coming online outside of OPEC — like the increased drilling activity of U.S. shale producers, and the new fields entering production in Kazakhstan and Brazil — total production may well rise over last year's levels.

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