Oil prices will stay lower for longer: We reiterated this outlook in the July 18 issue of Energy & Income Advisor and have maintained this forecast since fall 2014, despite many commentators calling for a V-shaped recovery in prices.
Earlier this year, far too many investors eager to load up on what they regarded as emerging values. And the short-lived relief rally in oil prices and energy-related equities earlier this year gave them confidence that the market had bottomed and emboldened them to plow money into ostensibly bargain-priced stocks.
Although many energy stocks look inexpensive relative to their recent price history, industry fundamentals have changed dramatically; a cheap stock can always get cheaper.
Investors should expect an uptick in bankruptcies among highly leveraged exploration and production companies with marginal assets. For example, investors betting that a takeover offer will rescue their underwater positions in SandRidge Energy (NYSE: SD) likely will be disappointed.
And even shares of best-in-class energy companies will suffer further downside if West Texas Intermediate (WTI) crude oil drops to less than $40 per barrel during the upcoming refinery turnaround season. This downside likely would extend to high-quality midstream names and the major integrated oil companies.
But real opportunities lurk amid all this pain.
With the exception of upstream operators, master limited partnerships have held up reasonably well relative to other groups in the energy sector. We survey some of the risks and opportunities.
Shares of US refiners have outperformed since oil prices swooned. Here's why and what's to come.
How US producers responded to plummeting natural-gas prices provides useful insight into how names with an oil-weighted output mix will contend with lower oil prices.
The price of a mixed barrel of NGLs on the Gulf Coast has plummeted by 45 percent since the end of the third quarter.
Fluctuations in the US dollar's value relative to major international currencies can influence crude-oil prices. But many more important factors are also at play.
We attended the National Association of Publicly Traded Partnerships' MLP Investor Conference and lived to tell the tale. Here are some of our key takeaways from the most important event of the year for MLP investors
Schlumberger's quarterly earnings call usually includes loads of useful insights for energy investors; the company's most recent conference call was no exception.
We'll be looking for value at the NAPTP's annual MLP investor conference.
The most important event of the year for MLP investors is just around the corner.
Elliott and Roger on Jul. 28, 2015
Balanced portfolios of energy stocks for aggressive and conservative investors.
Our take on more than 50 energy-related equities, from upstream to downstream and everything in between.
Our assessment of every energy-related master limited partnership.
Roger Conrad’s coverage of more than 70 dividend-paying energy names.