O&G sector still rife with challenges

Dateline 2015-12-21, Borneo Post:

The oil and gas (O&G) industry will still likely face headwinds ahead as uncertainties of oil prices continue, driven by various global events.

The research arm of CIMB Investment Bank Bhd (CIMB Research) in a recent report, pointed out that recently, the industry has been hit by three events that will likely affect oil prices.

“Brent and WTI have both declined to US$37.19 (down 3.3 per cent) and US$35.74 (down 4.3 per cent) respectively overnight on news of surprising weekly build-up in US crude inventories coupled with the Federal Reserve’s 0.25 per cent rate hike announcement earlier this morning.

“This was further exacerbated by the proposal that US may lift the 40-year ban on crude oil exports. Investors have been bracing themselves for these decisions where the hike would support the dollar, and make oil (priced in dollars) more expensive to other currency holders,” the research team explained.

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