SlideShare una empresa de Scribd logo
1 de 16
Descargar para leer sin conexión
EY Price Point:
global oil and gas
market outlook
Q2 | April 2021
Q2 overview
Gary Donald
EY Global Oil & Gas Assurance Leader
gdonald@uk.ey.com
Andy Brogan
EY Global Oil & Gas Leader
abrogan@uk.ey.com
Q2 | April 2021 EY Price Point: global oil and gas market outlook
Page 2
At the close of last quarter, we asked two questions. The first was whether oil market confidence could be
sustained until COVID-19 vaccination programs started to bend the curve on cases. The second was whether
OPEC+ could maintain supply discipline until they did. The answer to both of those questions was a resounding
“yes”, at least for now. From the beginning of January until the end of March, WTI and Brent prices increased
steadily from near US$50/bbl on New Years Day, to more that US$65/bbl at the peak in mid-March. The
recovery in prices has been carefully engineered by OPEC+, led by Saudi Arabia and at every opportunity, the
organization has resisted the urge to bring production back online prematurely. In early January (and
subsequently reaffirmed in March), Saudi Arabia committed to reducing production by 1 million barrels per day,
a move that clearly triggered the positive sentiment we have seen since.
Recovery in the sector hasn’t been confined to the upstream markets. A combination of refinery shutdowns and
recovery in demand pushed margins up by 64% during the quarter. As of late March, the RBOB crack spread
was trading above US$20/bbl. In late October of last year, those contracts were barely trading above
US$11/bbl. The most dramatic story in the energy markets this quarter was the paralyzing cold wave in the US
that brought the Texas power grid to its knees, but had only a marginal impact on global oil and gas markets.
The quarter began with high hopes for those who watched LNG markets in anticipation the long-awaited era of
sustained pricing that would support new investment had finally arrived. Those market-watchers ended the
quarter disappointed.
Q2 theme
?
Q2 | April 2021 EY Price Point: global oil and gas market outlook
Page 3
The theme for this quarter is governed. Apparent market balance at prices that could be sustainable is the
product of calculated choices by market leaders and the cooperation of those who follow them. Economics
played their customary role as well, with capital scarcity in North America taking about 2 million barrels per
day out of the market, about half of the remaining gap in demand. While inventories are close to their pre-
COVID-19 levels, there is still uncertainty. The resolution of the pandemic is in sight, but timing is unclear.
Vaccine distribution in the US is having an impact but Europe is struggling to contain a third wave of infections.
The taps have opened on economic stimulus, but it remains to be seen if policymakers have done enough or if
they have overshot the mark.
The shape of the crude oil forward curve has fundamentally changed since the end of the last quarter. In late
December of last year, the Brent forward curve was gradually increasing while today, the curve is
backwardated. This is a clear sign that the market sees a short-term dynamic that is disconnected from the
medium-to-long-term fundamentals. The lasting impact of the COVID-19 pandemic remains to be seen. While
many have opined that COVID-19 marks a turning point in energy transition, the IEA recently released a five-
year forecast of oil demand that shows steady growth, albeit at rates that are below historical expectations.
Gas markets are a paradox. At the Henry Hub and at LNG destinations, demand grows, investment lags and
prices will occasionally attract attention. Traders, so far though, are unconvinced and futures prices don’t
indicate imminent scarcity at any link in the value chain.
• How long (if ever) will it take for crude oil demand to return to pre-COVID-19 levels?
• Will expansionary fiscal and monetary policy have the desired result or will it produce inflation and currency
devaluation? How might that impact oil markets?
• Is upstream gas activity adequate to keep up with demand? What happens if it isn’t?
• Will the market respond to the recent spike in LNG projects with new investment or will it wait and see?
Q2 trends
EY Price Point: global oil and gas market outlook
Page 4 Q2 | April 2021
Capital
spending
higher, but
still below
sustainable
levels
Crude oil supply and demand both
increased, but OPEC discipline ensures
that the market remains undersupplied
in the aggregate. A return to normal
inventories is within sight.
The journey to
normal for
crude oil
inventories
continues
In the last (supply-driven) downturn,
downstream businesses were a safe
haven. In the latest (demand-driven)
downturn, all points on the value chain
were adversely impacted. However,
refining economics improved this
quarter.
Refining
margins
recovering
Investors
increasingly
focused on
ESG matters
Going forward, attention to long-term
value considerations and tangible
actions to decarbonize will enable oil
and gas companies’ access to capital.
Investor questions are becoming more
frequent and pointed.
Although higher than 2020, capital
spending plans are well below where
they were before the COVID-19
pandemic. With demand returning to
normal levels, there is a risk that supply
won’t keep up.
Market fundamentals
Q2 | April 2021 EY Price Point: global oil and gas market outlook
Page 5
Oil demand, supply and inventories approaching a balance
Source: US EIA
• In the first quarter, oil market balance continued to tilt toward an inventory draw.
Demand crept up, OPEC and oil producers outside of North America increased output
while the capital constrained North American producers reduced output.
• Going forward, we can expect continued gradual growth in demand and supply. Over
time, as inventories draw down to where they were before the pandemic, producers will
coordinate supply expansion at rates slightly higher than demand recovery until the
market is balanced in real time.
• Economic forecasts are positive across the board. The most recent OPEC outlook
projects the global economy to grow by 5.1%, up from previous forecast of 4.8%. The
US Federal Reserve is equally positive, recently raising their estimate of economic
growth in 2021 from 4.8% to 6.5%.
• OPEC expects that global oil demand is expected to expand by 5.9 million barrels per
day (mmbpd) this year to reach 96.3 mmbpd in 2021, almost 3 mmbpd less than in
2019.
Source: Credit Suisse
0
5
10
15
20
2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 1Q21E
$/bbl
Global refining margins (US$/bbl)
Singapore Northwest Europe US Gulf Coast
• Fuel demand destruction caused refining margins to fall dramatically during the
pandemic. In Q4 2020, refining margins in Europe and Asia were 82% and 77%,
respectively, below Q4 2019 levels. The US landscape is slightly more positive. Q4
margins were only 50% below pre-COVID-19 levels, with extensive refinery closures and
supply cuts partially offsetting demand reduction.
• Refining margins are likely to recover gradually in 2021, as the pandemic subsides and
the demand for gasoline and (especially) aviation fuel picks up. Demand for liquids is
expected to be within 1 mmbpd of pre-crisis levels by the end of 2021, and exports to
emerging markets in Africa and Latin America could boost Gulf Coast margins.
• Recovery in refining margins can be enhanced by increased fuel demand during the back
half of 2021, coupled with rationalization of refining capacity. The industry has already
announced 4.1 mmbpd of effective and potential closures since 2020, and there could be
more to come.
• The long-term outlook for refining continues to be unclear. The IEA expects liquids
demand to grow for the next five years, but the geography and product mix will change.
Refining margins improving, but unattractive
Movement to oversupply
Movement to undersupply
Q2 | April 2021 EY Price Point: global oil and gas market outlook
Page 6
Market fundamentals
Global upstream capital spending to marginally increase in 2021 Stimulus, inflation and currency devaluation may impact oil prices
• 2021 will be a transition year as crude oil demand and prices stabilize. However,
spending will remain restrained. The industry’s benchmark E&P spending survey shows
spending increasing slightly (1% up y-o-y) in 2021 after experiencing a 29% decline in
2020.
• Growth will be entirely driven by international markets such as Latin America (19% up y-
o-y) and Russia (16% up y-o-y). North American upstream spending is expected to fall by
another 4% in 2021 (after a 44% decline in 2020) with onshore US spending declining to
nearly half of its pre-COVID level.
• Long-term uncertainty and increasing pressure from stakeholders for capital discipline
has pushed companies to prioritize capital on critical assets and short-cycle projects.
Reinvestment is at historic lows, with upstream spending projected to be less than 60%
of 2021 cash flows.
• Oil and gas demand has recovered substantially and will continue to recover while
inventories are expected to return to normal levels. When that happens, the market may
be surprised to learn the impact of sustained capital spending reductions on supply
capacity. Spot shortages and price spikes are a real possibility in the intermediate term.
• Stimulus spending and accommodating monetary policy have been a central feature of
government and central bank response to COVID-19 across the globe. In late October,
the World Economic Forum reported that total government response has totaled over
US$11 trillion. Between the CARES Act, the most recent US$1.9 trillion package and
everything in between, the total US commitment has been over US$5 trillion. The US
Federal Reserve and it’s counterparts have bought new government debt liberally and
have aggressively supported credit markets.
• Oil is denominated in US dollars everywhere and a falling dollar reduces the price of oil in
local currencies and puts upward pressure on oil prices. In the last quarter of 2020, that
effect was evident as the trade-weighted value of the dollar fell by 5.1% and the price of
WTI crude increased by 25%. In the first quarter of 2021, the price of oil continued to
surge while the value of the dollar stabilized.
• Economic analysts are still processing the short-run and long-run combined impact of
the various economic interventions. Recently, the Federal Reserve raised its inflation
forecast for this year from 1.8% to 2.4%, and the inflation rate implied by indexed
treasury securities has gone up from 1.5% to 2.5% since the end of Q3 2020. Depending
on what happens in other countries, further dollar devaluation could be on the horizon.
257.1 254.2 270.9 215.0 220.8
100.0 152.3 139.2
78.0 74.8
0
250
500
2017 2018 2019 2020 2021
Global E&P Spending Survey (US$ billion)
International North America
Source: Barclays E&P spending survey, 5 January 2021
30
40
50
60
70
80
110
115
120
125
6/2020 9/2020 12/2020 3/2021
Crude
oil
prices
US
dollar
index
US trade weighted dollar index vs. crude oil prices
Trade Weighted US Dollar Index Brent (US$/bbl) WTI (US$/bbl)
Source: US EIA and Federal Reserve Bank of St. Louis (FRED)
Q2 | April 2021 EY Price Point: global oil and gas market outlook
Page 7
Market fundamentals
US majors respond to analyst concerns about energy transition Regional gas price spreads back to pre-pandemic levels
• Until very recently, the oil industry’s response to the energy transition has been a “tale
of two hemispheres,” with European majors acting aggressively to diversify into low-
carbon businesses and US-based majors standing by their core business.
• Pressure on the US majors to change course comes from multiple directions. The Biden
administration has announced that it intends to re-join the Paris Agreement, the US
Energy Secretary used her first public appearance to urge companies to embrace energy
transition, investment funds have stated their intention to redirect capital based on
companies’ performance against Environmental, Societal and Governance (ESG) metrics.
Additionally, in the last round of earnings calls, the number of analyst questions to US oil
majors related to decarbonization or alternative energy investments went from 1 in both
1Q20 and 2Q20, to nearly 10 in each of the last two quarters.
• Companies have responded to the pressure by announcing targets for scope 1 and scope
2 emissions. Time will tell how much of a difference these announcements will make. No
US majors announced scope 3 targets or plans to make significant investment in low-
carbon businesses.
• The global LNG market is showing signs of rebalance. Regional gas price spreads reached
record highs in January before returning to pre-pandemic levels in February and March.
The spread between Asian LNG spot prices and US Henry Hub prices increased ~75x
from US$0.2/MMBtu in May 2020 to US$15/MMBtu in January 2021 (the highest since
2016) and settled at US$3.4/MMBtu in March 2021.
• The Asian market was driven by supply disruptions in January and lower-than-expected
temperatures fuelling a surge in demand. Soft demand in February and March ensued
and spot prices averaged US$6.5/MMBtu and US$6.1/MMBtu, respectively. Gas stocks in
Europe have declined to 31% full (below the 5-year average), largely driven by LNG
exports diverted to Asia. In contrast, the US gas prices have been stable for the past
three months at an average price of ~US$2.7/MMBtu.
• US LNG exports are expected to head to Europe in coming months as depleted European
stocks have narrowed the spreads between Asian and European markets.
• Based on the financial statements of major LNG suppliers, we have estimated that a
US$6/MMBtu spread is necessary to support new investment. Notwithstanding, the post-
pandemic price environment seems to be stimulating interest in new LNG projects,
including the recent sanctioning of a large (32 mmtpa) project in Qatar.
Source: EY analysis of quarterly earnings call transcripts
Note: Oil majors include BP, Chevron, ExxonMobil, Shell, Eni, Total and Equinor
Source: Refinitiv
0
5
10
15
20
Regional gas prices (US$/MMBtu)
TR NE Asia LNG spot TTF front month hist Henry Hub front month hist
Note: Scope 1 includes direct emissions such as fuel combusted at a refinery, Scope 2 includes indirect emissions from finished
energy purchases such as purchased electricity used in facility operations. Scope 3 includes indirect emissions that are not included
in scope 1 and 2, such as emissions due to the produced fuel used by end customers.
7 11 7
26
16
26
16
34
2
1
1
1
1
11
8
1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20
Number of analyst questions to oil majors on alternative energy
investments and decarbonization
European oil majors US oil majors
Brent futures
Q2 | April 2021
Page 8
Brent futures have increased in
the short term given global
COVID-19 vaccination programs
coupled with the continued
supply discipline of the OPEC+.
Going forward, there will be
continued scrutiny on global
vaccine distribution, changes in
mobility patterns,
decarbonization and actions by
OPEC+ that will continue to
impact medium- to long-term oil
demand.
Futures data is effective as of
15 March 2021.
Source: Bloomberg
EY Price Point: global oil and gas market outlook
10
20
30
40
50
60
70
80
US$/bbl
Historical Brent Brent futures – March 2021 Brent futures – December 2020
35
45
55
65
75
85
2021 2022 2023 2024 2025
US$
per
barrel
Bank/broker range Consultants range
Bank/broker average Consultants average
40
50
60
70
80
90
2021 2022 2023 2024 2025
US$
per
barrel
Bank/broker range Consultants range
Bank/broker average Consultants average
Q2 | April 2021
Page 9
Oil price outlook
For both benchmarks, consultants
(on average) forecast higher oil
prices throughout the forecast
period.
Consultants focus primarily on the analysis of a
long-term sustainable oil price, whereas banks
and brokers balance their views on the basis of
current market conditions.
Consultant ranges include estimates of
recognized market consultants. Where consultant
estimates are updated only annually (for
example, the EIA and the IEA), such estimates are
included within the range of estimates from 2023
onward (or combined with short-term estimates
published by the same consultant) to prevent
near-term ranges being impacted by estimates
that are not considered to reflect current market
dynamics. Brent price estimates derived under
the IEA’s “Stated Policies” and “Sustainable
Development” scenarios (inflation adjusted to
reflect nominal pricing) are reflected within the
consultant ranges from 2023 onward.
Consultant forecasts result in averages of
US$64.1/bbl and US$59.2/bbl for Brent and
WTI, respectively, in 2025.
This data is effective as of 15 March 2021.
EY Price Point: global oil and gas market outlook
Note: The wide range of long-term price estimates reflects the degree of uncertainty within the market. Both the lower and upper end of the range provided are supported by the estimates of credible market participants. Given the width
of the range, the average of estimates should be used as a starting point for the assessment or generation of estimates.
Brent:
Average price per bbl forecast in 2025 — consultants
Brent
Bank/broker and consultant price estimates, ranges
and averages
WTI
Bank/broker and consultant price estimates, ranges
and averages
Source: Bloomberg; bank/broker reports; consultants’ websites and reports
US$64.1 WTI: US$59.2
Average price per bbl forecast in 2025 — consultants
35
40
45
50
55
2021 2022 2023 2024 2025
GBp
per
therm
Bank/broker range Consultants range
Bank/broker average Consultants average
1.5
2.0
2.5
3.0
3.5
4.0
2021 2022 2023 2024 2025
US$
per
MMbtu
Bank/broker range Consultants range
Bank/broker average Consultants average
Q2 | April 2021
Page 10
Gas price outlook
The banks and brokers forecasts
(on average) are wider in the
short-term than consultants for
Henry Hub and NBP. The trend is
reversed starting in 2024.
Consultants focus primarily on the analysis of a
long-term sustainable gas price, whereas banks
and brokers balance their views on the basis of
current market conditions.
Consultant ranges include estimates of
recognized market consultants. Where consultant
estimates are updated only annually (for
example, the EIA and the IEA), such estimates are
included within the range of estimates from 2023
onward (or combined with short-term estimates
published by the same consultant) to prevent
near-term ranges being impacted by estimates
that are not considered to reflect current market
dynamics. Henry Hub price estimates derived
under the IEA’s “Stated Policies” and
”Sustainable Development” scenarios (inflation
adjusted to reflect nominal pricing) are reflected
within the consultant ranges from 2023 onward.
NBP price estimates are scarce, with only six and
four forecasts released by banks and brokers and
consultants, respectively.
This data is effective as of 15 March 2021.
EY Price Point: global oil and gas market outlook
Note: The wide range of long-term price estimates reflects the degree of uncertainty within the market. Both the lower and upper end of the range provided are supported by the estimates of credible market participants. Given the width
of the range, the average of estimates should be used as a starting point for the assessment or generation of estimates.
*NBP: National Balancing Point
Henry Hub:
Average price per MMBtu forecast in 2025 — consultants
UK NBP:
Average price per therm forecast in 2025 — consultants
Henry Hub
Bank/broker and consultant price estimates, ranges
and averages
UK NBP
Bank/broker and consultant price estimates, ranges
and averages
US$3.0 GBp46.8
Source: Bloomberg; bank/broker reports; consultants’ websites and reports.
Appendix
Q2 | April 2021 EY Price Point: global oil and gas market outlook
Page 11
Brent oil price estimates
This data is effective as of 15 March 2021.
Source: Bloomberg; bank/broker reports
*Certain price estimates included within the summary above may reflect real vs. nominal pricing as the bank/broker assumptions are not explicitly stated within Bloomberg or the respective reports.
Source: Consultants’ websites and reports; Oxford Economics
Bank/broker 2021 (US$/bbl) 2022 (US$/bbl) 2023 (US$/bbl) 2024 (US$/bbl) 2025 (US$/bbl)
High 71.5 68.5 68.0 63.0 64.3
Average 58.7 60.1 60.1 58.9 59.5
Median 58.9 60.5 60.0 60.0 62.0
Low 49.0 53.0 52.0 53.0 54.0
Consultant 2021 (US$/bbl) 2022 (US$/bbl) 2023 (US$/bbl) 2024 (US$/bbl) 2025 (US$/bbl)
High 67.1 64.6 72.2 76.9 80.6
Average 55.4 56.0 60.3 62.8 64.1
Median 55.6 55.0 58.5 60.7 62.0
Low 46.6 49.8 54.6 55.7 56.4
Note: Consultant ranges include estimates of recognized market consultants. Where consultant estimates are updated only annually (for example, the EIA and the IEA), such estimates are included within the range of estimates from 2023
onward (or combined with short-term estimates published by the same consultant) to prevent near-term ranges being impacted by estimates that are not considered to reflect current market dynamics. Price estimates derived under the
IEA’s “Stated Policies” and “Sustainable Development” scenarios (inflation adjusted to reflect nominal pricing) are reflected within the consultant ranges from 2023 onward.
Appendix
Q2 | April 2021 EY Price Point: global oil and gas market outlook
Page 12
WTI oil price estimates
This data is effective as of 15 March 2021.
Bank/broker 2021 (US$/bbl) 2022 (US$/bbl) 2023 (US$/bbl) 2024 (US$/bbl) 2025 (US$/bbl)
High 68.5 63.5 65.0 67.0 61.2
Average 56.1 57.0 56.8 57.0 56.1
Median 56.8 57.0 57.0 58.0 60.0
Low 46.0 49.5 48.0 48.0 49.0
Source: Bloomberg; banks and brokers reports
*Certain price estimates included within the summary above may reflect real vs. nominal pricing as the bank/broker assumptions are not explicitly stated within Bloomberg or the respective reports.
Consultant 2021 (US$/bbl) 2022 (US$/bbl) 2023 (US$/bbl) 2024 (US$/bbl) 2025 (US$/bbl)
High 64.1 61.5 65.4 74.0 77.5
Average 52.7 52.9 55.3 58.0 59.2
Median 53.5 52.0 53.7 56.5 55.8
Low 44.3 47.8 52.0 53.1 53.8
Source: Consultants’ websites and reports; Oxford Economics; EY analysis
Note: Consultant ranges include estimates of recognized market consultants. Where consultant estimates are updated only annually (for example, the EIA), such estimates are included within the range of estimates from 2023 onward (or
combined with short-term estimates published by the same consultant) to prevent near-term ranges being impacted by estimates that are not considered to reflect current market dynamics.
Appendix
Q2 | April 2021 EY Price Point: global oil and gas market outlook
Page 13
Henry Hub gas price estimates
This data is effective as of 15 March 2021.
Source: Bloomberg; banks and brokers reports
* Where brokers have reported figures in US$/mcf, we have used a conversion ratio of 1.037 for mcf conversion to MMBtu.
**Certain price estimates included within the summary above may reflect real vs. nominal pricing as the bank/broker assumptions are not explicitly stated within Bloomberg or the respective reports.
Source: Consultants’ websites and reports; Oxford Economics
Bank/broker 2021 (US$/MMBtu) 2022 (US$/MMBtu) 2023 (US$/MMBtu) 2024 (US$/MMBtu) 2025 (US$/MMBtu)
High 3.3 3.5 3.6 3.6 3.8
Average 2.8 2.8 2.8 3.0 3.1
Median 2.8 2.8 2.8 2.9 3.0
Low 2.4 2.4 2.4 2.5 2.7
Consultant 2021 (US$/MMBtu) 2022 (US$/MMBtu) 2023 (US$/MMBtu) 2024 (US$/MMBtu) 2025 (US$/MMBtu)
High 3.1 3.2 3.4 3.6 3.8
Average 2.9 3.0 2.9 3.0 3.0
Median 2.9 3.0 2.9 2.9 3.0
Low 2.8 2.8 2.4 2.3 2.3
Note: Consultant ranges include estimates of recognized market consultants. Where consultant estimates are updated only annually (for example, the EIA and the IEA), such estimates are included within the range of estimates from 2023
onward (or combined with short-term estimates published by the same consultant) to prevent near-term ranges being impacted by estimates that are not considered to reflect current market dynamics. Price estimates derived under the
IEA’s “Stated Policies” and “Sustainable Development” scenarios (inflation adjusted to reflect nominal pricing) are reflected within the consultant ranges from 2023 onward.
Appendix
Q2 | April 2021 EY Price Point: global oil and gas market outlook
Page 14
NBP gas price estimates
This data is effective as of 15 March 2021.
Bank/broker 2021 (GBp/therm) 2022 (GBp/therm) 2023 (GBp/therm) 2024 (GBp/therm) 2025 (GBp/therm)
High 45.0 50.0 52.0 55.0 42.0
Average 42.2 42.7 42.7 43.8 40.7
Median 42.9 42.0 40.0 40.0 40.0
Low 38.6 37.6 38.6 40.0 40.0
Consultant 2021 (GBp/therm) 2022 (GBp/therm) 2023 (GBp/therm) 2024 (GBp/therm) 2025 (GBp/therm)
High 48.9 45.0 45.0 54.0 53.8
Average 42.9 40.8 42.7 46.0 46.8
Median 42.1 40.6 43.9 45.5 46.5
Low 38.6 37.0 38.0 39.2 40.3
Source: Bloomberg; banks and brokers reports
* Where brokers have reported figures in US$/mcf, we have used a conversion ratio of 1.037 for mcf conversion to MMBtu and the brokers’ forecasted FX rates.
**Certain price estimates included within the summary above may reflect real vs. nominal pricing as the bank and broker assumptions are not explicitly stated within Bloomberg or the respective reports.
Source: Consultants’ websites and reports; Oxford Economics
*Where consultants have reported figures in US$/MMBtu, we have used the particular consultants' forecast FX rate for the purpose of our conversion.
Note: Consultant ranges include estimates of recognized market consultants. Where consultant estimates are updated only annually, such estimates are included within the range of estimates from 2023 onward (or combined with short-
term estimates published by the same consultant) to prevent near-term ranges being impacted by estimates that are not considered to reflect current market dynamics.
Key contacts
Q2 | April 2021 EY Price Point: global oil and gas market outlook
Page 15
Important notice
Price outlook data included in this publication is effective as of 15 March 2021. Given the rapidly evolving nature of the
market and views of market participants, analysis can quickly become outdated. It should be noted that EY analysis is
not for the purpose of providing an independent view of the outlook for oil and gas prices. Instead, we are collating the
views of market participants.
Price outlook data should not be applied mechanistically. Instead, careful consideration should be given to the purpose
of any value assessment, with price forecasts assessed in the context of other key assumptions, such as resources and
reserves classification, production rates, discount rates and cost escalation rates, together with an appreciation of the
key sensitivities in any such analysis.
Gary Donald
EY Global Oil & Gas
Assurance Leader
+44 20 7951 7518
Derek Leith
EY Global Oil & Gas
Tax Leader
+44 12 2465 3246
Andy Brogan
EY Global Oil & Gas
Leader
+44 20 7951 7009
John Hartung
EY Americas Oil & Gas
Strategy & Transactions
Leader
+1 713 751 2114
Gaurav Ghoge
EY Global Oil & Gas
Strategy Execution Leader
+ 1 713 750 4890
EY | Building a better working world
EY exists to build a better working world, helping create long-term value for
clients, people and society and build trust in the capital markets.
Enabled by data and technology, diverse EY teams in over 150 countries
provide trust through assurance and help clients grow, transform and
operate.
Working across assurance, consulting, law, strategy, tax and transactions, EY
teams ask better questions to find new answers for the complex issues facing
our world today.
EY refers to the global organization, and may refer to one or more, of the
member firms of Ernst & Young Global Limited, each of which is a separate
legal entity. Ernst & Young Global Limited, a UK company limited by
guarantee, does not provide services to clients. Information about how EY
collects and uses personal data and a description of the rights individuals
have under data protection legislation are available via ey.com/privacy. EY
member firms do not practice law where prohibited by local laws. For more
information about our organization, please visit ey.com.
How EY’s Global Oil & Gas team can help you
As changing demand and pricing volatility transforms the oil and gas industry,
companies must reshape to thrive in this new energy world. But how do you
balance the immediate cost and regulatory pressures of “now” with
investment in what comes “next?” EY’s Global Oil & Gas team brings together
the breadth of experience and talent needed to approach the entire
transformation process. By considering four key pillars of change — structure
and culture, customers, technology, and skills and capabilities — we can help
you adapt for today and reap the opportunities of tomorrow. And together we
can build a better working world.
© 2021 EYGM Limited.
All Rights Reserved.
EYG no. 002711-21Gbl
ED None
This material has been prepared for general informational purposes only and is not intended to be relied
upon as legal, accounting, tax or other professional advice. Please refer to your advisors for specific
advice.
ey.com

Más contenido relacionado

La actualidad más candente

EY Chemical Market Outlook - February 2020
EY Chemical Market Outlook - February 2020EY Chemical Market Outlook - February 2020
EY Chemical Market Outlook - February 2020EY
 
EY Power transactions and trends: Q2 2018
EY Power transactions and trends: Q2 2018EY Power transactions and trends: Q2 2018
EY Power transactions and trends: Q2 2018EY
 
What’s Chipping Away at Automotive Production
What’s Chipping Away at Automotive ProductionWhat’s Chipping Away at Automotive Production
What’s Chipping Away at Automotive ProductionBoston Consulting Group
 
2019 Media and Entertainment Study
2019 Media and Entertainment Study2019 Media and Entertainment Study
2019 Media and Entertainment StudyL.E.K. Consulting
 
The FDA and industry: A recipe for collaborating in the New Health Economy
The FDA and industry:  A recipe for collaborating in the New Health EconomyThe FDA and industry:  A recipe for collaborating in the New Health Economy
The FDA and industry: A recipe for collaborating in the New Health EconomyPwC
 
The 4th Annual New Mobility Study 2019
The 4th Annual New Mobility Study 2019The 4th Annual New Mobility Study 2019
The 4th Annual New Mobility Study 2019L.E.K. Consulting
 
Lifting the Barriers to Retail Innovation in ASEAN | A.T. Kearney
Lifting the Barriers to Retail Innovation in ASEAN | A.T. KearneyLifting the Barriers to Retail Innovation in ASEAN | A.T. Kearney
Lifting the Barriers to Retail Innovation in ASEAN | A.T. KearneyKearney
 
The Merchandising Evolution (and why NDC Matters)
The Merchandising Evolution (and why NDC Matters)The Merchandising Evolution (and why NDC Matters)
The Merchandising Evolution (and why NDC Matters)L.E.K. Consulting
 
MAPS2018 Keynote address on EY report: Life Sciences 4.0 – Securing value thr...
MAPS2018 Keynote address on EY report: Life Sciences 4.0 – Securing value thr...MAPS2018 Keynote address on EY report: Life Sciences 4.0 – Securing value thr...
MAPS2018 Keynote address on EY report: Life Sciences 4.0 – Securing value thr...EY
 
IBOR transition: Opportunities and challenges for the asset management industry
IBOR transition: Opportunities and challenges for the asset management industryIBOR transition: Opportunities and challenges for the asset management industry
IBOR transition: Opportunities and challenges for the asset management industryEY
 
How fit is your capital allocation strategy?
How fit is your capital allocation strategy? How fit is your capital allocation strategy?
How fit is your capital allocation strategy? EY
 
Global Capital Confidence Barometer 21st edition
Global Capital Confidence Barometer 21st editionGlobal Capital Confidence Barometer 21st edition
Global Capital Confidence Barometer 21st editionEY
 
Retail Banking in the New Reality – Summary Survey Findings
Retail Banking in the New Reality – Summary Survey FindingsRetail Banking in the New Reality – Summary Survey Findings
Retail Banking in the New Reality – Summary Survey FindingsBoston Consulting Group
 
Australia: Taking Bigger Steps | A.T. Kearney
Australia: Taking Bigger Steps | A.T. KearneyAustralia: Taking Bigger Steps | A.T. Kearney
Australia: Taking Bigger Steps | A.T. KearneyKearney
 
PwC Trends in the workforce
PwC Trends in the workforcePwC Trends in the workforce
PwC Trends in the workforcePwC
 
EY Germany FinTech Landscape
EY Germany FinTech LandscapeEY Germany FinTech Landscape
EY Germany FinTech LandscapeEY
 
18th Annual Global CEO Survey - Technology industry key findings
18th Annual Global CEO Survey - Technology industry key findings18th Annual Global CEO Survey - Technology industry key findings
18th Annual Global CEO Survey - Technology industry key findingsPwC
 
Creating a Winning Recipe for a Meal Kits Program
Creating a Winning Recipe for a Meal Kits ProgramCreating a Winning Recipe for a Meal Kits Program
Creating a Winning Recipe for a Meal Kits ProgramL.E.K. Consulting
 
PwC’s new Golden Age Index – how well are countries harnessing the power of o...
PwC’s new Golden Age Index – how well are countries harnessing the power of o...PwC’s new Golden Age Index – how well are countries harnessing the power of o...
PwC’s new Golden Age Index – how well are countries harnessing the power of o...PwC
 

La actualidad más candente (20)

EY Chemical Market Outlook - February 2020
EY Chemical Market Outlook - February 2020EY Chemical Market Outlook - February 2020
EY Chemical Market Outlook - February 2020
 
EY Power transactions and trends: Q2 2018
EY Power transactions and trends: Q2 2018EY Power transactions and trends: Q2 2018
EY Power transactions and trends: Q2 2018
 
What’s Chipping Away at Automotive Production
What’s Chipping Away at Automotive ProductionWhat’s Chipping Away at Automotive Production
What’s Chipping Away at Automotive Production
 
2019 Media and Entertainment Study
2019 Media and Entertainment Study2019 Media and Entertainment Study
2019 Media and Entertainment Study
 
The FDA and industry: A recipe for collaborating in the New Health Economy
The FDA and industry:  A recipe for collaborating in the New Health EconomyThe FDA and industry:  A recipe for collaborating in the New Health Economy
The FDA and industry: A recipe for collaborating in the New Health Economy
 
The 4th Annual New Mobility Study 2019
The 4th Annual New Mobility Study 2019The 4th Annual New Mobility Study 2019
The 4th Annual New Mobility Study 2019
 
Lifting the Barriers to Retail Innovation in ASEAN | A.T. Kearney
Lifting the Barriers to Retail Innovation in ASEAN | A.T. KearneyLifting the Barriers to Retail Innovation in ASEAN | A.T. Kearney
Lifting the Barriers to Retail Innovation in ASEAN | A.T. Kearney
 
The Merchandising Evolution (and why NDC Matters)
The Merchandising Evolution (and why NDC Matters)The Merchandising Evolution (and why NDC Matters)
The Merchandising Evolution (and why NDC Matters)
 
MAPS2018 Keynote address on EY report: Life Sciences 4.0 – Securing value thr...
MAPS2018 Keynote address on EY report: Life Sciences 4.0 – Securing value thr...MAPS2018 Keynote address on EY report: Life Sciences 4.0 – Securing value thr...
MAPS2018 Keynote address on EY report: Life Sciences 4.0 – Securing value thr...
 
IBOR transition: Opportunities and challenges for the asset management industry
IBOR transition: Opportunities and challenges for the asset management industryIBOR transition: Opportunities and challenges for the asset management industry
IBOR transition: Opportunities and challenges for the asset management industry
 
How fit is your capital allocation strategy?
How fit is your capital allocation strategy? How fit is your capital allocation strategy?
How fit is your capital allocation strategy?
 
Global Capital Confidence Barometer 21st edition
Global Capital Confidence Barometer 21st editionGlobal Capital Confidence Barometer 21st edition
Global Capital Confidence Barometer 21st edition
 
Retail Banking in the New Reality – Summary Survey Findings
Retail Banking in the New Reality – Summary Survey FindingsRetail Banking in the New Reality – Summary Survey Findings
Retail Banking in the New Reality – Summary Survey Findings
 
Australia: Taking Bigger Steps | A.T. Kearney
Australia: Taking Bigger Steps | A.T. KearneyAustralia: Taking Bigger Steps | A.T. Kearney
Australia: Taking Bigger Steps | A.T. Kearney
 
PwC Trends in the workforce
PwC Trends in the workforcePwC Trends in the workforce
PwC Trends in the workforce
 
EY Germany FinTech Landscape
EY Germany FinTech LandscapeEY Germany FinTech Landscape
EY Germany FinTech Landscape
 
Brazil's Consumer Pulse Update
Brazil's Consumer Pulse UpdateBrazil's Consumer Pulse Update
Brazil's Consumer Pulse Update
 
18th Annual Global CEO Survey - Technology industry key findings
18th Annual Global CEO Survey - Technology industry key findings18th Annual Global CEO Survey - Technology industry key findings
18th Annual Global CEO Survey - Technology industry key findings
 
Creating a Winning Recipe for a Meal Kits Program
Creating a Winning Recipe for a Meal Kits ProgramCreating a Winning Recipe for a Meal Kits Program
Creating a Winning Recipe for a Meal Kits Program
 
PwC’s new Golden Age Index – how well are countries harnessing the power of o...
PwC’s new Golden Age Index – how well are countries harnessing the power of o...PwC’s new Golden Age Index – how well are countries harnessing the power of o...
PwC’s new Golden Age Index – how well are countries harnessing the power of o...
 

Similar a EY Price Point: global oil and gas market outlook, Q2 April 2021

EY Price Point: global oil and gas market outlook
EY Price Point: global oil and gas market outlookEY Price Point: global oil and gas market outlook
EY Price Point: global oil and gas market outlookEY
 
EY Q1 2020 price point
EY Q1 2020 price pointEY Q1 2020 price point
EY Q1 2020 price pointEY
 
EY Price Point: global oil and gas market outlook
EY Price Point: global oil and gas market outlookEY Price Point: global oil and gas market outlook
EY Price Point: global oil and gas market outlookEY
 
EY Price Point: global oil and gas market outlook – Q2
EY Price Point: global oil and gas market outlook – Q2EY Price Point: global oil and gas market outlook – Q2
EY Price Point: global oil and gas market outlook – Q2EY
 
ARM_NIGERIA_REPORT_H2_2015_OIL
ARM_NIGERIA_REPORT_H2_2015_OILARM_NIGERIA_REPORT_H2_2015_OIL
ARM_NIGERIA_REPORT_H2_2015_OILFrancis Ngene
 
EY Price Point: global oil and gas market outlook, Q319
EY Price Point: global oil and gas market outlook, Q319EY Price Point: global oil and gas market outlook, Q319
EY Price Point: global oil and gas market outlook, Q319EY
 
EY Price Point: Global oil and gas market outlook
EY Price Point: Global oil and gas market outlookEY Price Point: Global oil and gas market outlook
EY Price Point: Global oil and gas market outlookEY
 
EY Price Point: Global oil and gas market outlook Q4 2018
EY Price Point: Global oil and gas market outlook Q4 2018EY Price Point: Global oil and gas market outlook Q4 2018
EY Price Point: Global oil and gas market outlook Q4 2018EY
 
Mercer Capital's Value Focus: Energy Industry | Q1 2021 | Region Focus: Eagle...
Mercer Capital's Value Focus: Energy Industry | Q1 2021 | Region Focus: Eagle...Mercer Capital's Value Focus: Energy Industry | Q1 2021 | Region Focus: Eagle...
Mercer Capital's Value Focus: Energy Industry | Q1 2021 | Region Focus: Eagle...Mercer Capital
 
Global Oil Outlook August 2016
Global Oil Outlook August 2016Global Oil Outlook August 2016
Global Oil Outlook August 2016Eric Corbett
 
Mercer Capital's Value Focus: Energy Industry | Q1 2020 | Region Focus: Eagle...
Mercer Capital's Value Focus: Energy Industry | Q1 2020 | Region Focus: Eagle...Mercer Capital's Value Focus: Energy Industry | Q1 2020 | Region Focus: Eagle...
Mercer Capital's Value Focus: Energy Industry | Q1 2020 | Region Focus: Eagle...Mercer Capital
 
EY Price Point: Global Oil and Gas Market Outlook - Q3
EY Price Point: Global Oil and Gas Market Outlook - Q3EY Price Point: Global Oil and Gas Market Outlook - Q3
EY Price Point: Global Oil and Gas Market Outlook - Q3EY
 
EY Price Point: global oil and gas market outlook
EY Price Point: global oil and gas market outlookEY Price Point: global oil and gas market outlook
EY Price Point: global oil and gas market outlookEY
 
Mercer Capital's Value Focus: Energy Industry | Q4 2021 | Segment: Appalachia...
Mercer Capital's Value Focus: Energy Industry | Q4 2021 | Segment: Appalachia...Mercer Capital's Value Focus: Energy Industry | Q4 2021 | Segment: Appalachia...
Mercer Capital's Value Focus: Energy Industry | Q4 2021 | Segment: Appalachia...Mercer Capital
 
Slides ifri eyl_mazzega_covid19_opec_impacts
Slides ifri eyl_mazzega_covid19_opec_impactsSlides ifri eyl_mazzega_covid19_opec_impacts
Slides ifri eyl_mazzega_covid19_opec_impactsTanja42
 
Mercer Capital's Value Focus: Energy Industry | Q3 2020 | Region Focus : Bakken
Mercer Capital's Value Focus: Energy Industry | Q3 2020 | Region Focus : BakkenMercer Capital's Value Focus: Energy Industry | Q3 2020 | Region Focus : Bakken
Mercer Capital's Value Focus: Energy Industry | Q3 2020 | Region Focus : BakkenMercer Capital
 

Similar a EY Price Point: global oil and gas market outlook, Q2 April 2021 (20)

EY Price Point: global oil and gas market outlook
EY Price Point: global oil and gas market outlookEY Price Point: global oil and gas market outlook
EY Price Point: global oil and gas market outlook
 
EY Q1 2020 price point
EY Q1 2020 price pointEY Q1 2020 price point
EY Q1 2020 price point
 
EY Price Point: global oil and gas market outlook
EY Price Point: global oil and gas market outlookEY Price Point: global oil and gas market outlook
EY Price Point: global oil and gas market outlook
 
EY Price Point: global oil and gas market outlook – Q2
EY Price Point: global oil and gas market outlook – Q2EY Price Point: global oil and gas market outlook – Q2
EY Price Point: global oil and gas market outlook – Q2
 
ARM_NIGERIA_REPORT_H2_2015_OIL
ARM_NIGERIA_REPORT_H2_2015_OILARM_NIGERIA_REPORT_H2_2015_OIL
ARM_NIGERIA_REPORT_H2_2015_OIL
 
EY Price Point: global oil and gas market outlook, Q319
EY Price Point: global oil and gas market outlook, Q319EY Price Point: global oil and gas market outlook, Q319
EY Price Point: global oil and gas market outlook, Q319
 
EY Price Point: Global oil and gas market outlook
EY Price Point: Global oil and gas market outlookEY Price Point: Global oil and gas market outlook
EY Price Point: Global oil and gas market outlook
 
EY Price Point
EY Price PointEY Price Point
EY Price Point
 
EY Price Point: Global oil and gas market outlook Q4 2018
EY Price Point: Global oil and gas market outlook Q4 2018EY Price Point: Global oil and gas market outlook Q4 2018
EY Price Point: Global oil and gas market outlook Q4 2018
 
Mercer Capital's Value Focus: Energy Industry | Q1 2021 | Region Focus: Eagle...
Mercer Capital's Value Focus: Energy Industry | Q1 2021 | Region Focus: Eagle...Mercer Capital's Value Focus: Energy Industry | Q1 2021 | Region Focus: Eagle...
Mercer Capital's Value Focus: Energy Industry | Q1 2021 | Region Focus: Eagle...
 
Global Oil Outlook August 2016
Global Oil Outlook August 2016Global Oil Outlook August 2016
Global Oil Outlook August 2016
 
Mercer Capital's Value Focus: Energy Industry | Q1 2020 | Region Focus: Eagle...
Mercer Capital's Value Focus: Energy Industry | Q1 2020 | Region Focus: Eagle...Mercer Capital's Value Focus: Energy Industry | Q1 2020 | Region Focus: Eagle...
Mercer Capital's Value Focus: Energy Industry | Q1 2020 | Region Focus: Eagle...
 
EY Price Point: Global Oil and Gas Market Outlook - Q3
EY Price Point: Global Oil and Gas Market Outlook - Q3EY Price Point: Global Oil and Gas Market Outlook - Q3
EY Price Point: Global Oil and Gas Market Outlook - Q3
 
EY Price Point 8.17.20
EY Price Point  8.17.20EY Price Point  8.17.20
EY Price Point 8.17.20
 
EY Price Point: global oil and gas market outlook
EY Price Point: global oil and gas market outlookEY Price Point: global oil and gas market outlook
EY Price Point: global oil and gas market outlook
 
PMCWeeklyReview_082115
PMCWeeklyReview_082115PMCWeeklyReview_082115
PMCWeeklyReview_082115
 
Mercer Capital's Value Focus: Energy Industry | Q4 2021 | Segment: Appalachia...
Mercer Capital's Value Focus: Energy Industry | Q4 2021 | Segment: Appalachia...Mercer Capital's Value Focus: Energy Industry | Q4 2021 | Segment: Appalachia...
Mercer Capital's Value Focus: Energy Industry | Q4 2021 | Segment: Appalachia...
 
Slides ifri eyl_mazzega_covid19_opec_impacts
Slides ifri eyl_mazzega_covid19_opec_impactsSlides ifri eyl_mazzega_covid19_opec_impacts
Slides ifri eyl_mazzega_covid19_opec_impacts
 
Mercer Capital's Value Focus: Energy Industry | Q3 2020 | Region Focus : Bakken
Mercer Capital's Value Focus: Energy Industry | Q3 2020 | Region Focus : BakkenMercer Capital's Value Focus: Energy Industry | Q3 2020 | Region Focus : Bakken
Mercer Capital's Value Focus: Energy Industry | Q3 2020 | Region Focus : Bakken
 
ExxonMobil Final
ExxonMobil FinalExxonMobil Final
ExxonMobil Final
 

Más de EY

Quarterly analyst themes of oil and gas earnings, Q1 2022
Quarterly analyst themes of oil and gas earnings, Q1 2022Quarterly analyst themes of oil and gas earnings, Q1 2022
Quarterly analyst themes of oil and gas earnings, Q1 2022EY
 
Tax Alerte - Principales dispositions loi de finances 2021
Tax Alerte - Principales dispositions loi de finances 2021Tax Alerte - Principales dispositions loi de finances 2021
Tax Alerte - Principales dispositions loi de finances 2021EY
 
Tax Alerte - prix de transfert - PLF 2021
Tax Alerte - prix de transfert - PLF 2021Tax Alerte - prix de transfert - PLF 2021
Tax Alerte - prix de transfert - PLF 2021EY
 
Zahl der Gewinnwarnungen steigt auf Rekordniveau
Zahl der Gewinnwarnungen steigt auf RekordniveauZahl der Gewinnwarnungen steigt auf Rekordniveau
Zahl der Gewinnwarnungen steigt auf RekordniveauEY
 
Versicherer rechnen mit weniger Neugeschäft
Versicherer rechnen mit weniger NeugeschäftVersicherer rechnen mit weniger Neugeschäft
Versicherer rechnen mit weniger NeugeschäftEY
 
Liquidity for advanced manufacturing and automotive sectors in the face of Co...
Liquidity for advanced manufacturing and automotive sectors in the face of Co...Liquidity for advanced manufacturing and automotive sectors in the face of Co...
Liquidity for advanced manufacturing and automotive sectors in the face of Co...EY
 
Fusionen und Übernahmen dürften nach der Krise zunehmen
Fusionen und Übernahmen dürften nach der Krise zunehmenFusionen und Übernahmen dürften nach der Krise zunehmen
Fusionen und Übernahmen dürften nach der Krise zunehmenEY
 
Start-ups: Absturz nach dem Boom?
Start-ups: Absturz nach dem Boom?Start-ups: Absturz nach dem Boom?
Start-ups: Absturz nach dem Boom?EY
 
Riding the crest of digital health in APAC
Riding the crest of digital health in APACRiding the crest of digital health in APAC
Riding the crest of digital health in APACEY
 
Jobmotor Mittelstand gerät ins Stocken
Jobmotor Mittelstand gerät ins Stocken Jobmotor Mittelstand gerät ins Stocken
Jobmotor Mittelstand gerät ins Stocken EY
 
Trotz Rekordumsätzen ist die Stimmung im Agribusiness durchwachsen
Trotz Rekordumsätzen ist die Stimmung im Agribusiness durchwachsenTrotz Rekordumsätzen ist die Stimmung im Agribusiness durchwachsen
Trotz Rekordumsätzen ist die Stimmung im Agribusiness durchwachsenEY
 
Rekordsummen für deutsche Start-ups
Rekordsummen für deutsche Start-upsRekordsummen für deutsche Start-ups
Rekordsummen für deutsche Start-upsEY
 
Deutschlands börsennotierte Unternehmen werden weiblicher
Deutschlands börsennotierte Unternehmen werden weiblicherDeutschlands börsennotierte Unternehmen werden weiblicher
Deutschlands börsennotierte Unternehmen werden weiblicherEY
 
Kommunen setzen auf E-Mobilität
Kommunen setzen auf E-MobilitätKommunen setzen auf E-Mobilität
Kommunen setzen auf E-MobilitätEY
 
Paradigm shift in supply chain management for chemical operating models
Paradigm shift in supply chain management for chemical operating modelsParadigm shift in supply chain management for chemical operating models
Paradigm shift in supply chain management for chemical operating modelsEY
 
Bezpieczny Podatnik - Bezpieczne ulgi podatkowe 2019.pdf
Bezpieczny Podatnik - Bezpieczne ulgi podatkowe 2019.pdfBezpieczny Podatnik - Bezpieczne ulgi podatkowe 2019.pdf
Bezpieczny Podatnik - Bezpieczne ulgi podatkowe 2019.pdfEY
 
Weibliche Vorstände verdienen mehr
Weibliche Vorstände verdienen mehrWeibliche Vorstände verdienen mehr
Weibliche Vorstände verdienen mehrEY
 
Rekordsummen für europäische Start-ups
Rekordsummen für europäische Start-upsRekordsummen für europäische Start-ups
Rekordsummen für europäische Start-upsEY
 
EY Banken- und FinTech-Barometer Oktober 2019
EY Banken- und FinTech-Barometer Oktober 2019EY Banken- und FinTech-Barometer Oktober 2019
EY Banken- und FinTech-Barometer Oktober 2019EY
 

Más de EY (19)

Quarterly analyst themes of oil and gas earnings, Q1 2022
Quarterly analyst themes of oil and gas earnings, Q1 2022Quarterly analyst themes of oil and gas earnings, Q1 2022
Quarterly analyst themes of oil and gas earnings, Q1 2022
 
Tax Alerte - Principales dispositions loi de finances 2021
Tax Alerte - Principales dispositions loi de finances 2021Tax Alerte - Principales dispositions loi de finances 2021
Tax Alerte - Principales dispositions loi de finances 2021
 
Tax Alerte - prix de transfert - PLF 2021
Tax Alerte - prix de transfert - PLF 2021Tax Alerte - prix de transfert - PLF 2021
Tax Alerte - prix de transfert - PLF 2021
 
Zahl der Gewinnwarnungen steigt auf Rekordniveau
Zahl der Gewinnwarnungen steigt auf RekordniveauZahl der Gewinnwarnungen steigt auf Rekordniveau
Zahl der Gewinnwarnungen steigt auf Rekordniveau
 
Versicherer rechnen mit weniger Neugeschäft
Versicherer rechnen mit weniger NeugeschäftVersicherer rechnen mit weniger Neugeschäft
Versicherer rechnen mit weniger Neugeschäft
 
Liquidity for advanced manufacturing and automotive sectors in the face of Co...
Liquidity for advanced manufacturing and automotive sectors in the face of Co...Liquidity for advanced manufacturing and automotive sectors in the face of Co...
Liquidity for advanced manufacturing and automotive sectors in the face of Co...
 
Fusionen und Übernahmen dürften nach der Krise zunehmen
Fusionen und Übernahmen dürften nach der Krise zunehmenFusionen und Übernahmen dürften nach der Krise zunehmen
Fusionen und Übernahmen dürften nach der Krise zunehmen
 
Start-ups: Absturz nach dem Boom?
Start-ups: Absturz nach dem Boom?Start-ups: Absturz nach dem Boom?
Start-ups: Absturz nach dem Boom?
 
Riding the crest of digital health in APAC
Riding the crest of digital health in APACRiding the crest of digital health in APAC
Riding the crest of digital health in APAC
 
Jobmotor Mittelstand gerät ins Stocken
Jobmotor Mittelstand gerät ins Stocken Jobmotor Mittelstand gerät ins Stocken
Jobmotor Mittelstand gerät ins Stocken
 
Trotz Rekordumsätzen ist die Stimmung im Agribusiness durchwachsen
Trotz Rekordumsätzen ist die Stimmung im Agribusiness durchwachsenTrotz Rekordumsätzen ist die Stimmung im Agribusiness durchwachsen
Trotz Rekordumsätzen ist die Stimmung im Agribusiness durchwachsen
 
Rekordsummen für deutsche Start-ups
Rekordsummen für deutsche Start-upsRekordsummen für deutsche Start-ups
Rekordsummen für deutsche Start-ups
 
Deutschlands börsennotierte Unternehmen werden weiblicher
Deutschlands börsennotierte Unternehmen werden weiblicherDeutschlands börsennotierte Unternehmen werden weiblicher
Deutschlands börsennotierte Unternehmen werden weiblicher
 
Kommunen setzen auf E-Mobilität
Kommunen setzen auf E-MobilitätKommunen setzen auf E-Mobilität
Kommunen setzen auf E-Mobilität
 
Paradigm shift in supply chain management for chemical operating models
Paradigm shift in supply chain management for chemical operating modelsParadigm shift in supply chain management for chemical operating models
Paradigm shift in supply chain management for chemical operating models
 
Bezpieczny Podatnik - Bezpieczne ulgi podatkowe 2019.pdf
Bezpieczny Podatnik - Bezpieczne ulgi podatkowe 2019.pdfBezpieczny Podatnik - Bezpieczne ulgi podatkowe 2019.pdf
Bezpieczny Podatnik - Bezpieczne ulgi podatkowe 2019.pdf
 
Weibliche Vorstände verdienen mehr
Weibliche Vorstände verdienen mehrWeibliche Vorstände verdienen mehr
Weibliche Vorstände verdienen mehr
 
Rekordsummen für europäische Start-ups
Rekordsummen für europäische Start-upsRekordsummen für europäische Start-ups
Rekordsummen für europäische Start-ups
 
EY Banken- und FinTech-Barometer Oktober 2019
EY Banken- und FinTech-Barometer Oktober 2019EY Banken- und FinTech-Barometer Oktober 2019
EY Banken- und FinTech-Barometer Oktober 2019
 

Último

business environment micro environment macro environment.pptx
business environment micro environment macro environment.pptxbusiness environment micro environment macro environment.pptx
business environment micro environment macro environment.pptxShruti Mittal
 
International Business Environments and Operations 16th Global Edition test b...
International Business Environments and Operations 16th Global Edition test b...International Business Environments and Operations 16th Global Edition test b...
International Business Environments and Operations 16th Global Edition test b...ssuserf63bd7
 
Horngren’s Financial & Managerial Accounting, 7th edition by Miller-Nobles so...
Horngren’s Financial & Managerial Accounting, 7th edition by Miller-Nobles so...Horngren’s Financial & Managerial Accounting, 7th edition by Miller-Nobles so...
Horngren’s Financial & Managerial Accounting, 7th edition by Miller-Nobles so...ssuserf63bd7
 
8447779800, Low rate Call girls in New Ashok Nagar Delhi NCR
8447779800, Low rate Call girls in New Ashok Nagar Delhi NCR8447779800, Low rate Call girls in New Ashok Nagar Delhi NCR
8447779800, Low rate Call girls in New Ashok Nagar Delhi NCRashishs7044
 
Darshan Hiranandani [News About Next CEO].pdf
Darshan Hiranandani [News About Next CEO].pdfDarshan Hiranandani [News About Next CEO].pdf
Darshan Hiranandani [News About Next CEO].pdfShashank Mehta
 
Pitch deck sample detail for New Business Proposal
Pitch deck sample detail for New Business ProposalPitch deck sample detail for New Business Proposal
Pitch deck sample detail for New Business ProposalEvelina300651
 
8447779800, Low rate Call girls in Shivaji Enclave Delhi NCR
8447779800, Low rate Call girls in Shivaji Enclave Delhi NCR8447779800, Low rate Call girls in Shivaji Enclave Delhi NCR
8447779800, Low rate Call girls in Shivaji Enclave Delhi NCRashishs7044
 
8447779800, Low rate Call girls in Saket Delhi NCR
8447779800, Low rate Call girls in Saket Delhi NCR8447779800, Low rate Call girls in Saket Delhi NCR
8447779800, Low rate Call girls in Saket Delhi NCRashishs7044
 
Financial-Statement-Analysis-of-Coca-cola-Company.pptx
Financial-Statement-Analysis-of-Coca-cola-Company.pptxFinancial-Statement-Analysis-of-Coca-cola-Company.pptx
Financial-Statement-Analysis-of-Coca-cola-Company.pptxsaniyaimamuddin
 
1911 Gold Corporate Presentation Apr 2024.pdf
1911 Gold Corporate Presentation Apr 2024.pdf1911 Gold Corporate Presentation Apr 2024.pdf
1911 Gold Corporate Presentation Apr 2024.pdfShaun Heinrichs
 
Kenya Coconut Production Presentation by Dr. Lalith Perera
Kenya Coconut Production Presentation by Dr. Lalith PereraKenya Coconut Production Presentation by Dr. Lalith Perera
Kenya Coconut Production Presentation by Dr. Lalith Pereraictsugar
 
PSCC - Capability Statement Presentation
PSCC - Capability Statement PresentationPSCC - Capability Statement Presentation
PSCC - Capability Statement PresentationAnamaria Contreras
 
The-Ethical-issues-ghhhhhhhhjof-Byjus.pptx
The-Ethical-issues-ghhhhhhhhjof-Byjus.pptxThe-Ethical-issues-ghhhhhhhhjof-Byjus.pptx
The-Ethical-issues-ghhhhhhhhjof-Byjus.pptxmbikashkanyari
 
Call Us 📲8800102216📞 Call Girls In DLF City Gurgaon
Call Us 📲8800102216📞 Call Girls In DLF City GurgaonCall Us 📲8800102216📞 Call Girls In DLF City Gurgaon
Call Us 📲8800102216📞 Call Girls In DLF City Gurgaoncallgirls2057
 
8447779800, Low rate Call girls in Kotla Mubarakpur Delhi NCR
8447779800, Low rate Call girls in Kotla Mubarakpur Delhi NCR8447779800, Low rate Call girls in Kotla Mubarakpur Delhi NCR
8447779800, Low rate Call girls in Kotla Mubarakpur Delhi NCRashishs7044
 
8447779800, Low rate Call girls in Tughlakabad Delhi NCR
8447779800, Low rate Call girls in Tughlakabad Delhi NCR8447779800, Low rate Call girls in Tughlakabad Delhi NCR
8447779800, Low rate Call girls in Tughlakabad Delhi NCRashishs7044
 
Flow Your Strategy at Flight Levels Day 2024
Flow Your Strategy at Flight Levels Day 2024Flow Your Strategy at Flight Levels Day 2024
Flow Your Strategy at Flight Levels Day 2024Kirill Klimov
 
Fordham -How effective decision-making is within the IT department - Analysis...
Fordham -How effective decision-making is within the IT department - Analysis...Fordham -How effective decision-making is within the IT department - Analysis...
Fordham -How effective decision-making is within the IT department - Analysis...Peter Ward
 

Último (20)

business environment micro environment macro environment.pptx
business environment micro environment macro environment.pptxbusiness environment micro environment macro environment.pptx
business environment micro environment macro environment.pptx
 
International Business Environments and Operations 16th Global Edition test b...
International Business Environments and Operations 16th Global Edition test b...International Business Environments and Operations 16th Global Edition test b...
International Business Environments and Operations 16th Global Edition test b...
 
Horngren’s Financial & Managerial Accounting, 7th edition by Miller-Nobles so...
Horngren’s Financial & Managerial Accounting, 7th edition by Miller-Nobles so...Horngren’s Financial & Managerial Accounting, 7th edition by Miller-Nobles so...
Horngren’s Financial & Managerial Accounting, 7th edition by Miller-Nobles so...
 
8447779800, Low rate Call girls in New Ashok Nagar Delhi NCR
8447779800, Low rate Call girls in New Ashok Nagar Delhi NCR8447779800, Low rate Call girls in New Ashok Nagar Delhi NCR
8447779800, Low rate Call girls in New Ashok Nagar Delhi NCR
 
Darshan Hiranandani [News About Next CEO].pdf
Darshan Hiranandani [News About Next CEO].pdfDarshan Hiranandani [News About Next CEO].pdf
Darshan Hiranandani [News About Next CEO].pdf
 
Pitch deck sample detail for New Business Proposal
Pitch deck sample detail for New Business ProposalPitch deck sample detail for New Business Proposal
Pitch deck sample detail for New Business Proposal
 
Call Us ➥9319373153▻Call Girls In North Goa
Call Us ➥9319373153▻Call Girls In North GoaCall Us ➥9319373153▻Call Girls In North Goa
Call Us ➥9319373153▻Call Girls In North Goa
 
8447779800, Low rate Call girls in Shivaji Enclave Delhi NCR
8447779800, Low rate Call girls in Shivaji Enclave Delhi NCR8447779800, Low rate Call girls in Shivaji Enclave Delhi NCR
8447779800, Low rate Call girls in Shivaji Enclave Delhi NCR
 
8447779800, Low rate Call girls in Saket Delhi NCR
8447779800, Low rate Call girls in Saket Delhi NCR8447779800, Low rate Call girls in Saket Delhi NCR
8447779800, Low rate Call girls in Saket Delhi NCR
 
Financial-Statement-Analysis-of-Coca-cola-Company.pptx
Financial-Statement-Analysis-of-Coca-cola-Company.pptxFinancial-Statement-Analysis-of-Coca-cola-Company.pptx
Financial-Statement-Analysis-of-Coca-cola-Company.pptx
 
No-1 Call Girls In Goa 93193 VIP 73153 Escort service In North Goa Panaji, Ca...
No-1 Call Girls In Goa 93193 VIP 73153 Escort service In North Goa Panaji, Ca...No-1 Call Girls In Goa 93193 VIP 73153 Escort service In North Goa Panaji, Ca...
No-1 Call Girls In Goa 93193 VIP 73153 Escort service In North Goa Panaji, Ca...
 
1911 Gold Corporate Presentation Apr 2024.pdf
1911 Gold Corporate Presentation Apr 2024.pdf1911 Gold Corporate Presentation Apr 2024.pdf
1911 Gold Corporate Presentation Apr 2024.pdf
 
Kenya Coconut Production Presentation by Dr. Lalith Perera
Kenya Coconut Production Presentation by Dr. Lalith PereraKenya Coconut Production Presentation by Dr. Lalith Perera
Kenya Coconut Production Presentation by Dr. Lalith Perera
 
PSCC - Capability Statement Presentation
PSCC - Capability Statement PresentationPSCC - Capability Statement Presentation
PSCC - Capability Statement Presentation
 
The-Ethical-issues-ghhhhhhhhjof-Byjus.pptx
The-Ethical-issues-ghhhhhhhhjof-Byjus.pptxThe-Ethical-issues-ghhhhhhhhjof-Byjus.pptx
The-Ethical-issues-ghhhhhhhhjof-Byjus.pptx
 
Call Us 📲8800102216📞 Call Girls In DLF City Gurgaon
Call Us 📲8800102216📞 Call Girls In DLF City GurgaonCall Us 📲8800102216📞 Call Girls In DLF City Gurgaon
Call Us 📲8800102216📞 Call Girls In DLF City Gurgaon
 
8447779800, Low rate Call girls in Kotla Mubarakpur Delhi NCR
8447779800, Low rate Call girls in Kotla Mubarakpur Delhi NCR8447779800, Low rate Call girls in Kotla Mubarakpur Delhi NCR
8447779800, Low rate Call girls in Kotla Mubarakpur Delhi NCR
 
8447779800, Low rate Call girls in Tughlakabad Delhi NCR
8447779800, Low rate Call girls in Tughlakabad Delhi NCR8447779800, Low rate Call girls in Tughlakabad Delhi NCR
8447779800, Low rate Call girls in Tughlakabad Delhi NCR
 
Flow Your Strategy at Flight Levels Day 2024
Flow Your Strategy at Flight Levels Day 2024Flow Your Strategy at Flight Levels Day 2024
Flow Your Strategy at Flight Levels Day 2024
 
Fordham -How effective decision-making is within the IT department - Analysis...
Fordham -How effective decision-making is within the IT department - Analysis...Fordham -How effective decision-making is within the IT department - Analysis...
Fordham -How effective decision-making is within the IT department - Analysis...
 

EY Price Point: global oil and gas market outlook, Q2 April 2021

  • 1. EY Price Point: global oil and gas market outlook Q2 | April 2021
  • 2. Q2 overview Gary Donald EY Global Oil & Gas Assurance Leader gdonald@uk.ey.com Andy Brogan EY Global Oil & Gas Leader abrogan@uk.ey.com Q2 | April 2021 EY Price Point: global oil and gas market outlook Page 2 At the close of last quarter, we asked two questions. The first was whether oil market confidence could be sustained until COVID-19 vaccination programs started to bend the curve on cases. The second was whether OPEC+ could maintain supply discipline until they did. The answer to both of those questions was a resounding “yes”, at least for now. From the beginning of January until the end of March, WTI and Brent prices increased steadily from near US$50/bbl on New Years Day, to more that US$65/bbl at the peak in mid-March. The recovery in prices has been carefully engineered by OPEC+, led by Saudi Arabia and at every opportunity, the organization has resisted the urge to bring production back online prematurely. In early January (and subsequently reaffirmed in March), Saudi Arabia committed to reducing production by 1 million barrels per day, a move that clearly triggered the positive sentiment we have seen since. Recovery in the sector hasn’t been confined to the upstream markets. A combination of refinery shutdowns and recovery in demand pushed margins up by 64% during the quarter. As of late March, the RBOB crack spread was trading above US$20/bbl. In late October of last year, those contracts were barely trading above US$11/bbl. The most dramatic story in the energy markets this quarter was the paralyzing cold wave in the US that brought the Texas power grid to its knees, but had only a marginal impact on global oil and gas markets. The quarter began with high hopes for those who watched LNG markets in anticipation the long-awaited era of sustained pricing that would support new investment had finally arrived. Those market-watchers ended the quarter disappointed.
  • 3. Q2 theme ? Q2 | April 2021 EY Price Point: global oil and gas market outlook Page 3 The theme for this quarter is governed. Apparent market balance at prices that could be sustainable is the product of calculated choices by market leaders and the cooperation of those who follow them. Economics played their customary role as well, with capital scarcity in North America taking about 2 million barrels per day out of the market, about half of the remaining gap in demand. While inventories are close to their pre- COVID-19 levels, there is still uncertainty. The resolution of the pandemic is in sight, but timing is unclear. Vaccine distribution in the US is having an impact but Europe is struggling to contain a third wave of infections. The taps have opened on economic stimulus, but it remains to be seen if policymakers have done enough or if they have overshot the mark. The shape of the crude oil forward curve has fundamentally changed since the end of the last quarter. In late December of last year, the Brent forward curve was gradually increasing while today, the curve is backwardated. This is a clear sign that the market sees a short-term dynamic that is disconnected from the medium-to-long-term fundamentals. The lasting impact of the COVID-19 pandemic remains to be seen. While many have opined that COVID-19 marks a turning point in energy transition, the IEA recently released a five- year forecast of oil demand that shows steady growth, albeit at rates that are below historical expectations. Gas markets are a paradox. At the Henry Hub and at LNG destinations, demand grows, investment lags and prices will occasionally attract attention. Traders, so far though, are unconvinced and futures prices don’t indicate imminent scarcity at any link in the value chain. • How long (if ever) will it take for crude oil demand to return to pre-COVID-19 levels? • Will expansionary fiscal and monetary policy have the desired result or will it produce inflation and currency devaluation? How might that impact oil markets? • Is upstream gas activity adequate to keep up with demand? What happens if it isn’t? • Will the market respond to the recent spike in LNG projects with new investment or will it wait and see?
  • 4. Q2 trends EY Price Point: global oil and gas market outlook Page 4 Q2 | April 2021 Capital spending higher, but still below sustainable levels Crude oil supply and demand both increased, but OPEC discipline ensures that the market remains undersupplied in the aggregate. A return to normal inventories is within sight. The journey to normal for crude oil inventories continues In the last (supply-driven) downturn, downstream businesses were a safe haven. In the latest (demand-driven) downturn, all points on the value chain were adversely impacted. However, refining economics improved this quarter. Refining margins recovering Investors increasingly focused on ESG matters Going forward, attention to long-term value considerations and tangible actions to decarbonize will enable oil and gas companies’ access to capital. Investor questions are becoming more frequent and pointed. Although higher than 2020, capital spending plans are well below where they were before the COVID-19 pandemic. With demand returning to normal levels, there is a risk that supply won’t keep up.
  • 5. Market fundamentals Q2 | April 2021 EY Price Point: global oil and gas market outlook Page 5 Oil demand, supply and inventories approaching a balance Source: US EIA • In the first quarter, oil market balance continued to tilt toward an inventory draw. Demand crept up, OPEC and oil producers outside of North America increased output while the capital constrained North American producers reduced output. • Going forward, we can expect continued gradual growth in demand and supply. Over time, as inventories draw down to where they were before the pandemic, producers will coordinate supply expansion at rates slightly higher than demand recovery until the market is balanced in real time. • Economic forecasts are positive across the board. The most recent OPEC outlook projects the global economy to grow by 5.1%, up from previous forecast of 4.8%. The US Federal Reserve is equally positive, recently raising their estimate of economic growth in 2021 from 4.8% to 6.5%. • OPEC expects that global oil demand is expected to expand by 5.9 million barrels per day (mmbpd) this year to reach 96.3 mmbpd in 2021, almost 3 mmbpd less than in 2019. Source: Credit Suisse 0 5 10 15 20 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 1Q21E $/bbl Global refining margins (US$/bbl) Singapore Northwest Europe US Gulf Coast • Fuel demand destruction caused refining margins to fall dramatically during the pandemic. In Q4 2020, refining margins in Europe and Asia were 82% and 77%, respectively, below Q4 2019 levels. The US landscape is slightly more positive. Q4 margins were only 50% below pre-COVID-19 levels, with extensive refinery closures and supply cuts partially offsetting demand reduction. • Refining margins are likely to recover gradually in 2021, as the pandemic subsides and the demand for gasoline and (especially) aviation fuel picks up. Demand for liquids is expected to be within 1 mmbpd of pre-crisis levels by the end of 2021, and exports to emerging markets in Africa and Latin America could boost Gulf Coast margins. • Recovery in refining margins can be enhanced by increased fuel demand during the back half of 2021, coupled with rationalization of refining capacity. The industry has already announced 4.1 mmbpd of effective and potential closures since 2020, and there could be more to come. • The long-term outlook for refining continues to be unclear. The IEA expects liquids demand to grow for the next five years, but the geography and product mix will change. Refining margins improving, but unattractive Movement to oversupply Movement to undersupply
  • 6. Q2 | April 2021 EY Price Point: global oil and gas market outlook Page 6 Market fundamentals Global upstream capital spending to marginally increase in 2021 Stimulus, inflation and currency devaluation may impact oil prices • 2021 will be a transition year as crude oil demand and prices stabilize. However, spending will remain restrained. The industry’s benchmark E&P spending survey shows spending increasing slightly (1% up y-o-y) in 2021 after experiencing a 29% decline in 2020. • Growth will be entirely driven by international markets such as Latin America (19% up y- o-y) and Russia (16% up y-o-y). North American upstream spending is expected to fall by another 4% in 2021 (after a 44% decline in 2020) with onshore US spending declining to nearly half of its pre-COVID level. • Long-term uncertainty and increasing pressure from stakeholders for capital discipline has pushed companies to prioritize capital on critical assets and short-cycle projects. Reinvestment is at historic lows, with upstream spending projected to be less than 60% of 2021 cash flows. • Oil and gas demand has recovered substantially and will continue to recover while inventories are expected to return to normal levels. When that happens, the market may be surprised to learn the impact of sustained capital spending reductions on supply capacity. Spot shortages and price spikes are a real possibility in the intermediate term. • Stimulus spending and accommodating monetary policy have been a central feature of government and central bank response to COVID-19 across the globe. In late October, the World Economic Forum reported that total government response has totaled over US$11 trillion. Between the CARES Act, the most recent US$1.9 trillion package and everything in between, the total US commitment has been over US$5 trillion. The US Federal Reserve and it’s counterparts have bought new government debt liberally and have aggressively supported credit markets. • Oil is denominated in US dollars everywhere and a falling dollar reduces the price of oil in local currencies and puts upward pressure on oil prices. In the last quarter of 2020, that effect was evident as the trade-weighted value of the dollar fell by 5.1% and the price of WTI crude increased by 25%. In the first quarter of 2021, the price of oil continued to surge while the value of the dollar stabilized. • Economic analysts are still processing the short-run and long-run combined impact of the various economic interventions. Recently, the Federal Reserve raised its inflation forecast for this year from 1.8% to 2.4%, and the inflation rate implied by indexed treasury securities has gone up from 1.5% to 2.5% since the end of Q3 2020. Depending on what happens in other countries, further dollar devaluation could be on the horizon. 257.1 254.2 270.9 215.0 220.8 100.0 152.3 139.2 78.0 74.8 0 250 500 2017 2018 2019 2020 2021 Global E&P Spending Survey (US$ billion) International North America Source: Barclays E&P spending survey, 5 January 2021 30 40 50 60 70 80 110 115 120 125 6/2020 9/2020 12/2020 3/2021 Crude oil prices US dollar index US trade weighted dollar index vs. crude oil prices Trade Weighted US Dollar Index Brent (US$/bbl) WTI (US$/bbl) Source: US EIA and Federal Reserve Bank of St. Louis (FRED)
  • 7. Q2 | April 2021 EY Price Point: global oil and gas market outlook Page 7 Market fundamentals US majors respond to analyst concerns about energy transition Regional gas price spreads back to pre-pandemic levels • Until very recently, the oil industry’s response to the energy transition has been a “tale of two hemispheres,” with European majors acting aggressively to diversify into low- carbon businesses and US-based majors standing by their core business. • Pressure on the US majors to change course comes from multiple directions. The Biden administration has announced that it intends to re-join the Paris Agreement, the US Energy Secretary used her first public appearance to urge companies to embrace energy transition, investment funds have stated their intention to redirect capital based on companies’ performance against Environmental, Societal and Governance (ESG) metrics. Additionally, in the last round of earnings calls, the number of analyst questions to US oil majors related to decarbonization or alternative energy investments went from 1 in both 1Q20 and 2Q20, to nearly 10 in each of the last two quarters. • Companies have responded to the pressure by announcing targets for scope 1 and scope 2 emissions. Time will tell how much of a difference these announcements will make. No US majors announced scope 3 targets or plans to make significant investment in low- carbon businesses. • The global LNG market is showing signs of rebalance. Regional gas price spreads reached record highs in January before returning to pre-pandemic levels in February and March. The spread between Asian LNG spot prices and US Henry Hub prices increased ~75x from US$0.2/MMBtu in May 2020 to US$15/MMBtu in January 2021 (the highest since 2016) and settled at US$3.4/MMBtu in March 2021. • The Asian market was driven by supply disruptions in January and lower-than-expected temperatures fuelling a surge in demand. Soft demand in February and March ensued and spot prices averaged US$6.5/MMBtu and US$6.1/MMBtu, respectively. Gas stocks in Europe have declined to 31% full (below the 5-year average), largely driven by LNG exports diverted to Asia. In contrast, the US gas prices have been stable for the past three months at an average price of ~US$2.7/MMBtu. • US LNG exports are expected to head to Europe in coming months as depleted European stocks have narrowed the spreads between Asian and European markets. • Based on the financial statements of major LNG suppliers, we have estimated that a US$6/MMBtu spread is necessary to support new investment. Notwithstanding, the post- pandemic price environment seems to be stimulating interest in new LNG projects, including the recent sanctioning of a large (32 mmtpa) project in Qatar. Source: EY analysis of quarterly earnings call transcripts Note: Oil majors include BP, Chevron, ExxonMobil, Shell, Eni, Total and Equinor Source: Refinitiv 0 5 10 15 20 Regional gas prices (US$/MMBtu) TR NE Asia LNG spot TTF front month hist Henry Hub front month hist Note: Scope 1 includes direct emissions such as fuel combusted at a refinery, Scope 2 includes indirect emissions from finished energy purchases such as purchased electricity used in facility operations. Scope 3 includes indirect emissions that are not included in scope 1 and 2, such as emissions due to the produced fuel used by end customers. 7 11 7 26 16 26 16 34 2 1 1 1 1 11 8 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 Number of analyst questions to oil majors on alternative energy investments and decarbonization European oil majors US oil majors
  • 8. Brent futures Q2 | April 2021 Page 8 Brent futures have increased in the short term given global COVID-19 vaccination programs coupled with the continued supply discipline of the OPEC+. Going forward, there will be continued scrutiny on global vaccine distribution, changes in mobility patterns, decarbonization and actions by OPEC+ that will continue to impact medium- to long-term oil demand. Futures data is effective as of 15 March 2021. Source: Bloomberg EY Price Point: global oil and gas market outlook 10 20 30 40 50 60 70 80 US$/bbl Historical Brent Brent futures – March 2021 Brent futures – December 2020
  • 9. 35 45 55 65 75 85 2021 2022 2023 2024 2025 US$ per barrel Bank/broker range Consultants range Bank/broker average Consultants average 40 50 60 70 80 90 2021 2022 2023 2024 2025 US$ per barrel Bank/broker range Consultants range Bank/broker average Consultants average Q2 | April 2021 Page 9 Oil price outlook For both benchmarks, consultants (on average) forecast higher oil prices throughout the forecast period. Consultants focus primarily on the analysis of a long-term sustainable oil price, whereas banks and brokers balance their views on the basis of current market conditions. Consultant ranges include estimates of recognized market consultants. Where consultant estimates are updated only annually (for example, the EIA and the IEA), such estimates are included within the range of estimates from 2023 onward (or combined with short-term estimates published by the same consultant) to prevent near-term ranges being impacted by estimates that are not considered to reflect current market dynamics. Brent price estimates derived under the IEA’s “Stated Policies” and “Sustainable Development” scenarios (inflation adjusted to reflect nominal pricing) are reflected within the consultant ranges from 2023 onward. Consultant forecasts result in averages of US$64.1/bbl and US$59.2/bbl for Brent and WTI, respectively, in 2025. This data is effective as of 15 March 2021. EY Price Point: global oil and gas market outlook Note: The wide range of long-term price estimates reflects the degree of uncertainty within the market. Both the lower and upper end of the range provided are supported by the estimates of credible market participants. Given the width of the range, the average of estimates should be used as a starting point for the assessment or generation of estimates. Brent: Average price per bbl forecast in 2025 — consultants Brent Bank/broker and consultant price estimates, ranges and averages WTI Bank/broker and consultant price estimates, ranges and averages Source: Bloomberg; bank/broker reports; consultants’ websites and reports US$64.1 WTI: US$59.2 Average price per bbl forecast in 2025 — consultants
  • 10. 35 40 45 50 55 2021 2022 2023 2024 2025 GBp per therm Bank/broker range Consultants range Bank/broker average Consultants average 1.5 2.0 2.5 3.0 3.5 4.0 2021 2022 2023 2024 2025 US$ per MMbtu Bank/broker range Consultants range Bank/broker average Consultants average Q2 | April 2021 Page 10 Gas price outlook The banks and brokers forecasts (on average) are wider in the short-term than consultants for Henry Hub and NBP. The trend is reversed starting in 2024. Consultants focus primarily on the analysis of a long-term sustainable gas price, whereas banks and brokers balance their views on the basis of current market conditions. Consultant ranges include estimates of recognized market consultants. Where consultant estimates are updated only annually (for example, the EIA and the IEA), such estimates are included within the range of estimates from 2023 onward (or combined with short-term estimates published by the same consultant) to prevent near-term ranges being impacted by estimates that are not considered to reflect current market dynamics. Henry Hub price estimates derived under the IEA’s “Stated Policies” and ”Sustainable Development” scenarios (inflation adjusted to reflect nominal pricing) are reflected within the consultant ranges from 2023 onward. NBP price estimates are scarce, with only six and four forecasts released by banks and brokers and consultants, respectively. This data is effective as of 15 March 2021. EY Price Point: global oil and gas market outlook Note: The wide range of long-term price estimates reflects the degree of uncertainty within the market. Both the lower and upper end of the range provided are supported by the estimates of credible market participants. Given the width of the range, the average of estimates should be used as a starting point for the assessment or generation of estimates. *NBP: National Balancing Point Henry Hub: Average price per MMBtu forecast in 2025 — consultants UK NBP: Average price per therm forecast in 2025 — consultants Henry Hub Bank/broker and consultant price estimates, ranges and averages UK NBP Bank/broker and consultant price estimates, ranges and averages US$3.0 GBp46.8 Source: Bloomberg; bank/broker reports; consultants’ websites and reports.
  • 11. Appendix Q2 | April 2021 EY Price Point: global oil and gas market outlook Page 11 Brent oil price estimates This data is effective as of 15 March 2021. Source: Bloomberg; bank/broker reports *Certain price estimates included within the summary above may reflect real vs. nominal pricing as the bank/broker assumptions are not explicitly stated within Bloomberg or the respective reports. Source: Consultants’ websites and reports; Oxford Economics Bank/broker 2021 (US$/bbl) 2022 (US$/bbl) 2023 (US$/bbl) 2024 (US$/bbl) 2025 (US$/bbl) High 71.5 68.5 68.0 63.0 64.3 Average 58.7 60.1 60.1 58.9 59.5 Median 58.9 60.5 60.0 60.0 62.0 Low 49.0 53.0 52.0 53.0 54.0 Consultant 2021 (US$/bbl) 2022 (US$/bbl) 2023 (US$/bbl) 2024 (US$/bbl) 2025 (US$/bbl) High 67.1 64.6 72.2 76.9 80.6 Average 55.4 56.0 60.3 62.8 64.1 Median 55.6 55.0 58.5 60.7 62.0 Low 46.6 49.8 54.6 55.7 56.4 Note: Consultant ranges include estimates of recognized market consultants. Where consultant estimates are updated only annually (for example, the EIA and the IEA), such estimates are included within the range of estimates from 2023 onward (or combined with short-term estimates published by the same consultant) to prevent near-term ranges being impacted by estimates that are not considered to reflect current market dynamics. Price estimates derived under the IEA’s “Stated Policies” and “Sustainable Development” scenarios (inflation adjusted to reflect nominal pricing) are reflected within the consultant ranges from 2023 onward.
  • 12. Appendix Q2 | April 2021 EY Price Point: global oil and gas market outlook Page 12 WTI oil price estimates This data is effective as of 15 March 2021. Bank/broker 2021 (US$/bbl) 2022 (US$/bbl) 2023 (US$/bbl) 2024 (US$/bbl) 2025 (US$/bbl) High 68.5 63.5 65.0 67.0 61.2 Average 56.1 57.0 56.8 57.0 56.1 Median 56.8 57.0 57.0 58.0 60.0 Low 46.0 49.5 48.0 48.0 49.0 Source: Bloomberg; banks and brokers reports *Certain price estimates included within the summary above may reflect real vs. nominal pricing as the bank/broker assumptions are not explicitly stated within Bloomberg or the respective reports. Consultant 2021 (US$/bbl) 2022 (US$/bbl) 2023 (US$/bbl) 2024 (US$/bbl) 2025 (US$/bbl) High 64.1 61.5 65.4 74.0 77.5 Average 52.7 52.9 55.3 58.0 59.2 Median 53.5 52.0 53.7 56.5 55.8 Low 44.3 47.8 52.0 53.1 53.8 Source: Consultants’ websites and reports; Oxford Economics; EY analysis Note: Consultant ranges include estimates of recognized market consultants. Where consultant estimates are updated only annually (for example, the EIA), such estimates are included within the range of estimates from 2023 onward (or combined with short-term estimates published by the same consultant) to prevent near-term ranges being impacted by estimates that are not considered to reflect current market dynamics.
  • 13. Appendix Q2 | April 2021 EY Price Point: global oil and gas market outlook Page 13 Henry Hub gas price estimates This data is effective as of 15 March 2021. Source: Bloomberg; banks and brokers reports * Where brokers have reported figures in US$/mcf, we have used a conversion ratio of 1.037 for mcf conversion to MMBtu. **Certain price estimates included within the summary above may reflect real vs. nominal pricing as the bank/broker assumptions are not explicitly stated within Bloomberg or the respective reports. Source: Consultants’ websites and reports; Oxford Economics Bank/broker 2021 (US$/MMBtu) 2022 (US$/MMBtu) 2023 (US$/MMBtu) 2024 (US$/MMBtu) 2025 (US$/MMBtu) High 3.3 3.5 3.6 3.6 3.8 Average 2.8 2.8 2.8 3.0 3.1 Median 2.8 2.8 2.8 2.9 3.0 Low 2.4 2.4 2.4 2.5 2.7 Consultant 2021 (US$/MMBtu) 2022 (US$/MMBtu) 2023 (US$/MMBtu) 2024 (US$/MMBtu) 2025 (US$/MMBtu) High 3.1 3.2 3.4 3.6 3.8 Average 2.9 3.0 2.9 3.0 3.0 Median 2.9 3.0 2.9 2.9 3.0 Low 2.8 2.8 2.4 2.3 2.3 Note: Consultant ranges include estimates of recognized market consultants. Where consultant estimates are updated only annually (for example, the EIA and the IEA), such estimates are included within the range of estimates from 2023 onward (or combined with short-term estimates published by the same consultant) to prevent near-term ranges being impacted by estimates that are not considered to reflect current market dynamics. Price estimates derived under the IEA’s “Stated Policies” and “Sustainable Development” scenarios (inflation adjusted to reflect nominal pricing) are reflected within the consultant ranges from 2023 onward.
  • 14. Appendix Q2 | April 2021 EY Price Point: global oil and gas market outlook Page 14 NBP gas price estimates This data is effective as of 15 March 2021. Bank/broker 2021 (GBp/therm) 2022 (GBp/therm) 2023 (GBp/therm) 2024 (GBp/therm) 2025 (GBp/therm) High 45.0 50.0 52.0 55.0 42.0 Average 42.2 42.7 42.7 43.8 40.7 Median 42.9 42.0 40.0 40.0 40.0 Low 38.6 37.6 38.6 40.0 40.0 Consultant 2021 (GBp/therm) 2022 (GBp/therm) 2023 (GBp/therm) 2024 (GBp/therm) 2025 (GBp/therm) High 48.9 45.0 45.0 54.0 53.8 Average 42.9 40.8 42.7 46.0 46.8 Median 42.1 40.6 43.9 45.5 46.5 Low 38.6 37.0 38.0 39.2 40.3 Source: Bloomberg; banks and brokers reports * Where brokers have reported figures in US$/mcf, we have used a conversion ratio of 1.037 for mcf conversion to MMBtu and the brokers’ forecasted FX rates. **Certain price estimates included within the summary above may reflect real vs. nominal pricing as the bank and broker assumptions are not explicitly stated within Bloomberg or the respective reports. Source: Consultants’ websites and reports; Oxford Economics *Where consultants have reported figures in US$/MMBtu, we have used the particular consultants' forecast FX rate for the purpose of our conversion. Note: Consultant ranges include estimates of recognized market consultants. Where consultant estimates are updated only annually, such estimates are included within the range of estimates from 2023 onward (or combined with short- term estimates published by the same consultant) to prevent near-term ranges being impacted by estimates that are not considered to reflect current market dynamics.
  • 15. Key contacts Q2 | April 2021 EY Price Point: global oil and gas market outlook Page 15 Important notice Price outlook data included in this publication is effective as of 15 March 2021. Given the rapidly evolving nature of the market and views of market participants, analysis can quickly become outdated. It should be noted that EY analysis is not for the purpose of providing an independent view of the outlook for oil and gas prices. Instead, we are collating the views of market participants. Price outlook data should not be applied mechanistically. Instead, careful consideration should be given to the purpose of any value assessment, with price forecasts assessed in the context of other key assumptions, such as resources and reserves classification, production rates, discount rates and cost escalation rates, together with an appreciation of the key sensitivities in any such analysis. Gary Donald EY Global Oil & Gas Assurance Leader +44 20 7951 7518 Derek Leith EY Global Oil & Gas Tax Leader +44 12 2465 3246 Andy Brogan EY Global Oil & Gas Leader +44 20 7951 7009 John Hartung EY Americas Oil & Gas Strategy & Transactions Leader +1 713 751 2114 Gaurav Ghoge EY Global Oil & Gas Strategy Execution Leader + 1 713 750 4890
  • 16. EY | Building a better working world EY exists to build a better working world, helping create long-term value for clients, people and society and build trust in the capital markets. Enabled by data and technology, diverse EY teams in over 150 countries provide trust through assurance and help clients grow, transform and operate. Working across assurance, consulting, law, strategy, tax and transactions, EY teams ask better questions to find new answers for the complex issues facing our world today. EY refers to the global organization, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. Information about how EY collects and uses personal data and a description of the rights individuals have under data protection legislation are available via ey.com/privacy. EY member firms do not practice law where prohibited by local laws. For more information about our organization, please visit ey.com. How EY’s Global Oil & Gas team can help you As changing demand and pricing volatility transforms the oil and gas industry, companies must reshape to thrive in this new energy world. But how do you balance the immediate cost and regulatory pressures of “now” with investment in what comes “next?” EY’s Global Oil & Gas team brings together the breadth of experience and talent needed to approach the entire transformation process. By considering four key pillars of change — structure and culture, customers, technology, and skills and capabilities — we can help you adapt for today and reap the opportunities of tomorrow. And together we can build a better working world. © 2021 EYGM Limited. All Rights Reserved. EYG no. 002711-21Gbl ED None This material has been prepared for general informational purposes only and is not intended to be relied upon as legal, accounting, tax or other professional advice. Please refer to your advisors for specific advice. ey.com