Where Do You Stand Versus the Energy Consensus for 2013?
by John Blank
December 28, 2012 | Comments : 3 Recommended this article: (0)Please login to Zacks.com or register to post a comment.
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This week has been the week for me to construct Zacks Energy Consensus.
I do this once a quarter. The exercise is always revealing. I learn where the market's middle ground is. From fresh numbers, we can get a sharper sense for Energy investing positions to like in 2013.
Energy Market Consensus on Fundamentals.
OPEC say oil demand is growing at +0.8 million barrels a day in 2013. The same demand growth we saw in 2012 and 2011.
What does that imply in a global economy throwing up +3% to +4% GDP growth? Oil demand destruction is alive and well. At these prices for transport, the world's consumers and Energy-related businesses are making steady efficiency progress. Such facts spell investing opportunity.
OPEC says non-OPEC supply growth will reach +0.9 million barrels a day in 2013, up from +0.5 million barrels a day in 2012, and 30 thousand barrels a day in 2011. The U.S. is contributing a great deal to the new production.
Data from the North Dakota Industrial Commission showed that, in September 2012, shale oil production from the state climbed to approximately +660,000 barrels a day, up +4% m-o-m to yet another monthly record.
Once again, this opens up fresh Energy investing opportunity. At these prices, supply is responding much like market economy textbooks say it should.
Finally, Zacks fresh Energy marketprice consensus. To my eyes, our Energy price consensus looks pretty consistent with the global GDP Big Picture in 2013.
Energy Price Consensus for End of December 2013
WTI Crude- $95.25 per barrel up by +9.82%
Brent Crude- $107.38 per barrel, down by -1.57%.
RBOB Gasoline- $2.68 per gallon, down by -0.40%.
Natural Gas- $3.92 per MMBtu, up by +22.27%.
Having fresh facts in hand on Energy fundamentals and on Energy price outlooks for the next year, where do you as investors see the big opportunities?
Where is the consensus right? How do you plan to invest accordingly?
Where is the consensus wrong? Once again, how do you plan to invest, according to that non-consensus view?