Cowen: Global Oil and Gas Exploration Spending to Slide 17%
HOUSTON, Jan 7 (Reuters) – The world’s oil and gas exploration companies are expected to cut capital expenditures 17 percent this year as a deep slump in crude oil prices takes a toll on budgets, according to a survey by Cowen and Company released on Wednesday.
The survey, based on an average oil price of $70 per barrel, estimates that global exploration and production expenditures will slide 17 percent to $571 billion. If oil prices average $60 per barrel, spending should drop by 30 percent to 35 percent, according to the survey of 476 oil companies.
Crude oil futures traded in New York closed under $50 per barrel on Wednesday, weighed down by weak global demand and growing supplies. “We continue to advocate a cautious approach toward investing in oil service and drilling stocks,” said the Cowen analysts in a note to clients.
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