Oil & Gas Sector Update - Crude Prices Fall To Seven-Month Lows: ICICI Direct

Oil & Gas Sector Update - Crude Prices Fall To Seven-Month Lows: ICICI Direct

<div class="paragraphs"><p>(Source:&nbsp;<a href=";utm_medium=referral&amp;utm_content=creditCopyText">Zbynek Burival</a>/ <a href=";utm_medium=referral&amp;utm_content=creditCopyText">Unsplash</a>)</p></div>
(Source: Zbynek Burival/ Unsplash)

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ICICI Direct Report

Oil prices fell over the last two weeks by ~10% ($92/barrel of oil), to February 2022 lows led by weakening global demand. The correction in crude prices was on account of a possible recessionary scenario in the west, weak economic data from China (world’s second largest oil consumer), coupled with anticipated interest rate hikes hinting lower fuel demand.

As per media reports, China has imposed stringent Covid-19 curbs while its oil imports fell 9.4% YoY in August.

Natural gas prices have also fallen from highs of ~$70/metric million British thermal unit but continue to remain above comfortable levels. The above events will have a limited impact on the net realisation of public sector undertaking upstream companies such as Oil and Natural Gas Corporation Ltd. The impact on midstream companies will be neutral.

Click on the attachment to read the full report:

ICICI Direct Oil&Gas Sector Update.pdf


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