BSG&L Financial Services founding principal and Covestor portfolio manager Ben Dickey thinks oil prices may remain subdued in 2014, which could help some energy subsectors such as exploration and production companies, mid stream companies and chemical firms.
In commentary for the Oil & Gas Monitor, Dickey forecasts that oil prices should stay under $110 a barrel.
For 2014, we believe that the world economies will slowly improve which should generate a slight increase in energy demand. We also know that current reservoirs are going to continue to decline as usual and that new production will be needed to provide the shortfall. We believe that there will be enough new production in the world to keep oil prices, as represented by West Texas Intermediate (WTI) in the $95 to $110 per barrel price range for 2014. Under this scenario, we believe that the mid size E&P companies, the mid stream companies and the chemical companies will continue to show gains in profitability over the next year.
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