BP is planning for oil prices to stay low for the first six months of the year and expects surplus production to only start diminishing when storage tanks fill up in the second half.
“We are very bearish for the first half of the year,” Chief Executive Officer Robert Dudley said at the IP Week conference in London Wednesday. “In the second half, every tank and swimming pool in the world is going to fill and fundamentals are going to kick in. The market will start balancing in the second half of this year.” More than a year into a downturn sparked by OPEC’s decision to keep pumping to defend market share, prices are still 70 percent below their 2014 peak and companies are beset by plunging profits, dividend cuts and mass layoffs. The oil industry’s annual IP Week gathering in London has been dominated by warnings that the worst of the slump isn’t over. Crude is trading below $30 a barrel in New York after falling to a 12-year low last month, but production is still taking longer than expected to decline and record oil stockpiles just keep on growing, according to bankers, traders and executives attending the IP Week conference.
 

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