ProPetro Holding Corp. (NYSE: PUMP) saw its stock price plummet by 5.08% in pre-market trading on Monday, following a significant price target cut by Citigroup. The investment bank reduced its target for ProPetro from $10 to $6.50, citing concerns about the outlook for oilfield service companies amid deflating crude prices.

Citigroup's analysis paints a challenging picture for the oil industry, particularly for oilfield service providers like ProPetro. The bank notes that public exploration and production companies have shifted their investment strategies towards maintenance and efficiency-driven growth to maximize free cash flow. This shift, coupled with current market conditions, could lead to a reduction of about 75 oil rigs, or nearly 15% of domestic oil drilling operations.

The downgrade is part of a broader reassessment of the oilfield services sector by Citigroup. Other companies in the industry, including Halliburton, Schlumberger, and Patterson-UTI Energy, also saw their price targets lowered. Analysts at the bank expect potential margin compression from reduced operating leverage and modestly lower prices, which could further pressure companies like ProPetro in the coming months.