collected by :Jack Alex
Extraction Oil & Gas’ IPO was followed the a month later by that of WildHorse Resource Development Corp, an independent oil and gas field operator focused on the Eagle Ford shale play in Texas.
The oil price crash has left energy companies scrambling to shore up balance sheets and streamline costs.
Canada may see its biggest oil and gas IPO in more than two years.
But the recent recovery of crude prices has instilled cautious confidence among oil and gas firms that they might be able to raise capital for expansion via initial public offerings (IPOs).
Out of the 16 IPOs on the New York Stock Exchange so far this year, 25 percent, or 4 IPOs, were launched by energy companies, IPO Boutique’s 2017 IPO Industry Breakdown shows.
Oil Price Plunge Is An Overreaction, But It May Also Be A Turning Point
In part, the price slump reflects a growing realization that the OPEC production cut is unlikely to quickly resolve the problem of outsized global oil inventories.
The official narrative was that a larger-than-expected 8.2 million barrel (mmb) addition to U.S. crude oil inventories pushed prices lower.
That explanation is not consistent with larger recent additions to storage that had little effect on oil prices.
Oil prices plunged Wednesday.
Comparative inventory–the crucial price indicator–only moved up 2.4 mmb (Figure 3).
Oil Price Drop Not Surprising, Global Demand To Provide Support
We believe that the market has become overly comfortable with this tighter-than-average oil price range, and we are now reverting to oil’s more normal trading pattern.
We expect global demand growth to continue at a fairly robust rate, and to provide support for oil prices.
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