Although the oil and gas sector currently looks comfortable with the recovery in the oil price, not all markets are happy. US companies are cutting capex from the capital markets. Most strikingly, deal flow, particularly in the US, has stalled. European gas prices have also fallen sharply this year, following a surge in LNG supply, weakened Asian demand and a mild winter. Price weaknesses is expected this summer, with further downside if Russia does not curb its exports. A update of the oil cost curve shows small changes since last year, with the impact of US tight oil. The corporate team has also produced cost curves for the majors, which highlight the differences between the companies' portfolios. Our latest analysis of the oil market indicates continued support for the oil price, especially with a weak outlook for Venezuela. And, as we creep towards the adoption of IMO 2020, the longer term outlook for refining margins weakens as new capacity adds supply to the market.