The research house said the segment’s earnings improvement surpassed its expectations, with 88% of companies under its coverage either beating or meeting its forecasts and only 12% missing the forecasts.

As for the petrochemical and shipping segments, it said the segment’s earnings delivery only matched its expectations.

With Brent crude prices expected to remain stable at US$84 (RM393.79) per barrel, Kenanga Research also anticipated an increase in Petronas’s upstream spending in 2024, aligning more closely with its RM60 billion annual capital expenditure goal.

“The upstream services segment appears to be entering the initial stages of a potential upcycle which will usher in an influx of job opportunities in 2024 and potentially more favourable contract terms as the supply of both upstream services and vessels tightens,” it added.