The oil market’s volatility last week prompted a trio of market-watchers assembled by Rigzone to suggest themes that one might observe in an action film. Looking ahead to this week, our panelists anticipate more tough times in the near-term but also opportunities for deal-making and even a glimpse of better days perhaps in the coming months. Read on for their perspectives.
Tom McNulty, Houston-based managing director with B. Riley Financial’s Great American Group: I’m not sure we are ready to head back up to where WTI should be on a normalized basis – in that $34 to $37 range I keep taking about. But the time for spring cleaning the energy complex is here, and the liquidations and asset sales need to start soon. Energy companies that are liquid might start to bargain-shop. When, not if, the global economy restarts, demand will rise again.
Barani Krishnan, Senior Commodities Analyst at Investing.com: At this point, all market participants can do is hunker down and see how the U.S. infection rate from the COVID goes. In all likelihood, the numbers are going to be a lot worse, meaning little reprieve for oil. But on the flip side, if the Chinese start ordering some cargoes, given that they seem to be on the mend, then that would be a bright spark for crude.
Mark Le Dain, vice president of strategy with the oil and gas data firm Validere: Gas price forecasts are increasing as expected. This could be a really good few years as associated declines significantly and demand remains structural. In that regard, we’ve been really impressed with North American demand during the virus and there is even a question of whether it could be higher this summer if I’m stuck at home running my inefficient air conditioner all day.
To contact the author, email mveazey@rigzone.com.
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