General Electric company's worst business segment observed in 2015

Baku. 22 December. REPORT.AZ/ When oil prices have fallen as dramatically as they have in 2015, the financial incentive to invest in future oil and gas projects greatly diminishes, which in turn has made GE's oil and gas segment its worst this year, Report informs referring to the foreign media. 

Operating seven industrial segments is both a positive and negative for General Electric. On one hand, the diversification it offers reduces the balance sheet's exposure to headwinds that may negatively impact one of its segments, giving better staying power to ride out difficult periods than weaker rivals. On the other hand, it often means that GE's seven segments aren't firing on all cylinders at the same time, as they tend to follow different cycles, which can muddle overall performance.

Through the first nine months of 2015, three of GE's seven industrial segments experienced an annual revenue decline. The worst was its oil and gas segment, which caters to the entire oil industry: drilling, completion, production, oilfield operations (onshore and offshore), and transportation via pipelines and liquefied natural gas. When oil prices have fallen as dramatically as they have in 2015, the financial incentive to invest in future oil and gas projects greatly diminishes, which in turn has pressured GE's oil and gas segment.