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Energy Snapshot: Industry Themes - February 2016


Energy Snapshot: Industry Themes - February 2016

Report summary

With the Brent oil price down to a range of US$30-35per barrel, the production cost curve for oil  shows that 3.5 million b/d is failing to cover the cost of production, but only 100,000 b/d has been shut-in to date.  A large proportion of the marginal production comes from US "stripper" wells. Subsequently, US oil stocks are at an all-time high, but we believe that there is sufficient storage capacity for over half a year at recent build rates.  Demand is responding positively as we see that car sales have surged in China, surpassing the US.

In the global upstream sector, focus has shifted away from exploration in the low oil price environment, but companies have not completely rejected it as we've seen in Myanmar and Mexico's deepwater bid round. The corporate world is seeing a slow asset market with a large divergence in price expectations between buyers and sellers, leading to increased pressure on companies to balance their books.

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  • WM Energy Snapshot - Industry Themes Feb 2016.pdf PDF - 1.83 MB

Description

This Upstream Oil and Gas Insight report highlights the key issues surrounding this topic, and draws out the key implications for those involved.

This report helps participants, suppliers and advisors understand trends, risks and issues within the upstream oil and gas industry. It gives you an expert point of view to support informed decision making.

Wood Mackenzie's 500 dedicated analysts are located in the markets they cover. They produce forward-looking analysis at both country and asset level across the globe, backed by our robust proprietary database of trusted research.

Proprietary data means a superior level of analysis that is simply not available anywhere else. Wood Mackenzie is the recognised gold standard in upstream commercial data and analysis.

  • Energy Snapshot: Industry Themes - February 2016

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  • Energy Snapshot: Industry Themes - February 2016
    • Energy Snapshot: Industry Themes - February 2016: Image 1
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