Let's see where we are with the oilfield services group. On Friday, Schlumberger (NYSE:SLB), the papa bear of the contingent, reported earnings that were down year over year. Nevertheless, they were written in black ink, and the market boosted the company's shares by about 10%, before tacking on another 2% in the midst of a rather lackluster Monday.

The 800-pound gorilla was followed in short order by Monday's announcements by two of the other major service companies, Halliburton (NYSE:HAL) and Weatherford (NYSE:WFT). The fourth member of the major oilfield services firms, Baker Hughes (NYSE:BHI) will report its results on Wednesday.

Halliburton reports
Halliburton's results for the quarter were solid, assuming you're focusing on earnings from continuing operations. That metric rose to $776 million, or $0.87 a share, compared to the $674 million, or $0.74 a share, for the same quarter a year earlier. The analysts' consensus for the quarter was $0.73 per share.

Nevertheless, the company's announcement also included an agreement that it pay $559 million to the U.S. government to settle bribery charges in Nigeria stemming from its former engineering and construction subsidiary, KBR, Inc. (NYSE:KBR). Of that amount, it appears that a two-year payment will involve $382 million going to the Justice Department and the remaining $177 million going to the Securities and Exchange Commission.

Putting that aside, let's go back and take a closer look at current operations. The company's Completion and Production segment generated $659 million in operating income for the quarter, up $88 million -- 15% -- from the same quarter a year earlier. The strongest geographic region for the group was Europe-Africa-Commonwealth of Independent States (CIS), where operating income forged ahead by 38%. At the same time, Latin America operating income was up 25%, North America increased by 13%, and the Middle East-Asia region was about flat year over year. Those areas that turned in growth generally did so through increased demand for Halliburton's completion tools.

The other unit, Drilling and Evaluation, increased its operating income in the quarter to $529 million, or 31% above the fourth quarter of 2007. The geographic leader in this sector was the Middle East-Asia, where operating income increased by 88%, followed by an 84% jump in Latin America. With both the company's units boosting their business, total corporate revenues improved by 17.5% in the quarter.

As does Weatherford
Weatherford, which provides an array of equipment and services for oil and gas well drilling, along with well evaluation and completion, earned $348.1 million, or $0.50 a share, versus $331 million, or $0.47 a share, for the final quarter of 2007. Without one-time items, income from continuing operations show the company earned $0.53 a share, a penny more than the analysts who follow the company had expected.

The company's North American revenues increased 12% to $1,178 million during the quarter. This growth compared to a 7% rise in the rig count. At the same time, revenues from the Middle East/North Africa/Asia region grew by 26%, Europe/West Africa/CIS improved by 14%, and Latin America led the parade with a 52% improvement in its revenue contribution.

What's in the offing?
Looking ahead, the analysts who follow Baker Hughes are anticipating earnings about flat with last year's fourth-quarter figure of $1.26 a share. At the same time, those same analysts are anticipating an approximately 30% dip in the company's earnings for the full 2009 year.

Why the anticipated decline? You'll notice, probably more and more as time passes, that, unless there is an unexpected event that drives crude and natural gas prices higher, a host of oilfield services companies will begin to pull back on equipment orders, various other types of contracts, and perhaps their dividends. In fact, on Monday, Rowan (NYSE:RDC), a longtime member of the contract drilling fraternity -- and through its LeTourneau unit a manufacturer of rigs -- gave notice that it would eliminate its dividend and cancel the construction of a jack-up rig.

Buy, sell, or hold the group?
For my money, there remain opportunities in the oilfield services sector. But with oil and gas prices having plummeted significantly just since the summer, and with economic difficulties weighing heavily on worldwide demand, I would urge Fools to exercise caution in the group for now.

In fact, my own interest in the group is currently restricted to Schlumberger and Halliburton, which I believe have been oversold and which likely will benefit from the geographic spread of their operations. I'm also keeping an eye on Transocean (NYSE:RIG), the king of the offshore drillers, which is also geographically diverse and enjoys protection from its numerous long-term contracts.

Weatherford, KBR, Baker Hughes, and Transocean have all ascended to the five-star rung as judged by Motley Fool CAPS. Have you rated any -- or all -- of these companies?

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Fool contributor David Lee Smith doesn't own shares in any of the companies mentioned. He does welcome your questions or comments. The Fool has a disclosure policy.