The 2014 subsea tree volume is materially impacted by the lack of Brazilian demand which can skew perceived health of the industry. If we remove Brazil from the past five years of demand, the average rest-of-world tree award/year was ~260 units. The subsea industry remains on track to support and improve this average throughout our forecast period.
Quest continues to comminute that 2014 will be a softer award market than 2013 on the heels of little-to-no activity from Brazil (represented 33% of the 2013 subsea tree demand) and significantly lower demand from the North Sea (2013 was a near-term high water mark for the region’s subsea demand).
Quest has reduced its five-year subsea tree award forecast by ~five percent compared to the August deliverable. Softening in the North Sea and Asia are the main drivers to the most recent revisions