(The views and opinions expressed in this article are those of the attributed sources and do not necessarily reflect the position of Rigzone or the author.)
Will North American oil and gas industry players continue to pursue a relatively conservative course next year, or will they follow a more aggressive path? Signals about 2022 industry activity should become more abundant shortly, according to one of Rigzone’s regular market-watchers. Read on for his explanation, along with other perspectives on what to watch this week in oil and gas markets.
Jon Donnel, Managing Director, B. Riley Advisory Services: We should have a clearer picture on how things will unfold over the back half of the year as second quarter earnings reports continue to file in over the next couple of weeks. The large oilfield services companies have been relatively conservative regarding North American activity outlooks, suggesting modest increases in rig counts for the rest of the year. The recent volatility in commodity prices should help keep operators in line regarding CAPEX plans, but it will be interesting to see some initial views on 2022 – continued discipline or opportunity to take advantage of higher prices?
Tom Seng, Director – School of Energy Economics, Policy and Commerce, University of Tulsa’s Collins College of Business: The market seems to have taken a pause from concerns over the COVID-19 delta variant but will have to follow the spread more carefully from now on. More and more cases are occurring both globally and in the U.S. So long as we don’t return to mandatory shut-downs, demand may not fall as much as it did this past year. But Los Angeles County is already back to requiring mask-wearing in all indoor spaces.
On the natural gas front, look for expanding heat to increase demand for gas-fired generation. Dallas, which normally sees about 20 or so days of 100-degree temperatures, has not hit that mark as yet. However, forecasts (late last week were) calling for a 100-degree high Sunday.
Barani Krishnan, Senior Commodities Analyst, Investing.com: More Covid developments and less bull hype about oil demand, which has so far been really strong in one place only – the United States. There are many other countries that consume the black stuff, including China, which has proven its power in reducing commodity prices when needed. Case in point: China and copper.
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