Researchers at Barclay’s Bank will today claim that rising oil prices are good news for UK based energy companies saying they are ideally placed to exploit them.
Speaking at a seminar in Aberdeen the researchers have identified trends in the sector, including a slowdown of US output because of the suspension of deepwater drilling, a weakening oil supply outlook and an increase in demand.
Researchers at Barclay’s Bank will today claim that rising oil prices are good news for UK based energy companies saying they are ideally placed to exploit them.
Speaking at a seminar in Aberdeen the researchers have identified trends in the sector, including a slowdown of US output because of the suspension of deepwater drilling, a weakening oil supply outlook and an increase in demand.
According to Linzi Graham of Barclays Capital, supply and demand in the oil market are set to become increasingly out of synch.
“The fact that international air traffic is now back above pre-recession levels and goods movements are resulting in a rise in US trucking miles indicates a global recovery and US recovery respectively.
“The market research shows that longer-term oil supplies are potentially under threat, for example through suspension of drilling in the US and a weakening non-Opec outlook.
“In addition, Opec production capacity is expected to rise by less than 3million barrels per day (bpd) over the next five years. Having said that, demand growth in the second-quarter of 2010 was above 2million bpd for the first time in five years and there is a structural shift in the oil world; for example, China’s demand is outstripping its supply by far.”
Barclays is predicting oil prices to reach almost $90 a barrel by the end of this year, and to rise to $135 by 2015.
Jonathan Wilson, oil and gas team business development director at Barclays insisted the increase in oil price was good news for the industry and may well lead to stability and growth as well as an increase in activity.
Mr Watson added that a removal of the US deepwater drilling suspension might lead to companies looking to exploit opportunities in the UK.