- Brent crude oil has slumped to ~$72/bbl in recent days, the lowest point since early April, but Goldman Sachs analyst Damien Courvalin thinks Brent could touch the $80s again later this fall.
- "Ultimately, global inventories are low, oil demand remains robust and we still expect a deficit once U.S. secondary sanctions are reintroduced. As a result, we still expect Brent prices to retest $80/bbl, although U.S. oil policies may leave this occurring late this year rather than this summer as we previously expected," Courvalin writes.
- Courvalin attributes the weakness in Brent time spreads to stranded North Sea barrels as a result of a rise in U.S. exports and a slowdown in Chinese imports, not because inventory is starting to bloat again.
- Another Goldman analyst, Brian Singer, expects Cabot Oil & Gas (COG +0.1%) to report strong production results, better operating margins in H2 of this year and potential for more share buybacks on top of its ongoing 30M-share buyback plan; he also sees the potential for EOG Resources (EOG -0.3%) to raise its dividend with Q2 or Q3 earnings results.
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