Services giant Petrofac has warned that its engineering and construction (E&C) unit is continuing to be affected by “challenging market” conditions, with the recovery in oil prices yet to filter down in increased spending by its clients.

The unit’s first-half revenues are expected to be about $1 billion, reflecting lower levels of activity, disruption to project schedules caused by the Covid-19 pandemic, as well as rescoping on a project, the company said in a trading update on Monday.

Petrofac chief executive Sami Iskander said: “As expected, new orders are likely to remain depressed in E&C in the current year.”