No Higher Oil Price? Pessimistic CEO’s Speak Their Mind
An increasing amount of evidence suggests that the oil price will recover. The number of drilling platforms in the US has hit a new low almost every week and, besides that, the EIA expects production to be lower in May.
Furthermore, every driller is cutting back drastically on expenses, which will push production even further down. On the consumption side, however, figures are picking up because everyone is able to take advantage of cheap fuel.
What if the worst is not behind us? Despite the signs that indicate a rebound, Rex Tillerson, CEO of ExxonMobil, is very bearish on the price of oil. When he spoke on the IHS CeraWeek conference in Houston recently, Tillerson said that the oil price is doomed to remain low for years to come.
No Higher Oil Price
Although it is difficult to make predictions for the long term, there is also plenty of evidence that suggests that the oil price will not grow much higher. Although growth has slowed down in recent weeks, reserves are still significantly higher than the 5-year average, namely. Until production slows down so much that consumers are consuming more than production is replenishing, the oil price has limited upward potential.
The CEO of ConocoPhillips (COP) even believes that the price of oil will go down again. He says that if the price rises, the additional supply would put us back where we started. Let’s say the price arrives at 80 to 90 dollars per barrel, there is a good chance we will go back down to 50 to 60 dollars per barrel, because of the new oil that will flood the market.
ExxonMobil’s (XOM) CEO is not worried about his company’s continued existence if a long period of low energy prices ensues.
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