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WRAPUP 2-Schlumberger, Baker Hughes warn of weak fourth quarter

Oct 20 (Reuters) - The world's top two oilfield services firms warned on Friday of a challenging fourth quarter for the industry, as investment slows due to soft oil prices and energy firms reducing activity on offshore rigs.

Shares of Schlumberger NV dropped nearly 5 percent to a 21-month low of $61.41, while Baker Hughes tumbled 5.2 percent to a 16-month low of $31.44. Halliburton Co, scheduled to report on Monday, was little changed.

Last year, as oil prices bounced off multi-year lows hit at the start of 2016, optimism began to creep back into the energy industry. But after rising about 50 percent last year, Brent crude prices have barely budged this year, up a shade over 1 percent, which has again led to caution in the industry.

Schlumberger said investments in North America were moderating as energy companies increasingly shied away from chasing higher production at the cost of financial returns.

"In the U.S. Gulf of Mexico, activity continued to weaken in the third quarter, and the outlook remains bleak for this region based on current customer plans," Chief Executive Paal Kibsgaard said.

Kibsgaard said he expects the rate of growth in North America to slow and that market estimates for the fourth quarter, as they stand, are "potentially on the high end."

Baker Hughes' CEO Lorenzo Simonelli was even more pessimistic, and forecast the overall oil and gas environment to remain challenging for the rest of the year.

"We have seen some improvement in activity but we have not seen meaningful increases in customer capital commitments."

The dour outlooks come as U.S. oil producers are under pressure to boost shareholder returns after 2017 spending increases ran into flattish oil prices, knocking share prices back after a run up last year.

This summer, Anadarko Petroleum Corp, ConocoPhillips and Hess Corp cut second-half capital spending plans, including on oilfield services activities, due to weaker-than-expected U.S. crude prices.

The sub-$55 prices have also weighed on offshore exploration and driven a new round of consolidation among drillers in a bid to tame excess capacity and get price increases.

A recent survey by Deloitte showed most top U.S. oil executives see prices remaining below $60 per barrel through 2018 and not hitting $70 until at least the next decade.

Baker Hughes, in its first report to include GE Co's oil and gas business since their merger, reported a third-quarter profit that missed analysts estimates by a wide margin.

Schlumberger, however, matched analysts' profit estimates and posted a 43 percent jump in business from North America. (Reporting by Nivedita Bhattacharjee and Yashaswini Swamynathan in Bengaluru, and Gary McWillams in Houston; Editing by Savio D'Souza)