SHARES in Weir Group have plunged nine per cent after the engineering giant said sales in the key US oil and gas market had slowed in recent weeks.

Glasgow-based Weir received a boost from the upturn in the North American oil and gas market in the first half as the rally in the crude price encouraged firms to increase activity in US shale areas.

The company said yesterday North American oil and gas market conditions were in line with management expectations through to mid-August.

Regarding the last two weeks of August, Weir added: “There was a considerable softening in demand for original equipment and some order book delivery deferrals.”

The update may spark concern the recovery in oil and gas market activity could be fading.

Barclays analyst Lars Brorson, noted recent updates from US oil services giants Schlumberger and Halliburton had indicated activity levels in the Permian Shale in the US had dropped off materially in recent weeks.

“That is set to adversely impact Weir’s high margin pressure pumping business in H2,” wrote Mr Brorson.

He added: “We don’t think the investment case for Weir’s pressure pumping business is broken.” The oil price remains supportive and the number of wells drilled in the US is increasing. Weir shares closed down £1.54 at £16.32.