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PESA Remote Hosts Baker Institute’s Mark Finley for an Oil Market Outlook

Mark Finley, Fellow in Energy and Global Oil, Rice University’s Baker Institute for Public Policy outlined the historical landscape and implications of the current oil price war to more than 40 PESA Member Companies during a market outlook call held on March 19. As Member Companies navigate an unprecedented price market, PESA hosts experts, such as Finley, who share context and dissect impacts.

 As most are now aware, the price war began after a failed OPEC/non-OPEC summit in Vienna on March 6. In the context of reduced global demand from COVID-19, Saudi Arabia announced its largest price discount in 30 years – leading to the fall in price per barrel.

It was with this context that Finley discussed his most recent Forbes article, “Oil Market: The Bottom Fell Out — Now What?” where he looked for things to watch if the market becomes over-supplied. He pointed to watching official pricing, real-time estimates of production and inventory data. Additionally, Finley made a basic economic argument that existing wells will produce as long as they can cover their operating costs which could create pressure on U.S. and Canadian shale operators.

Several ‘wildcards’ in the current price war include U.S. shale producers under increased financial and productivity pressure, how OPEC producers manage their economies and government budgets and how the Trump Administration could support the domestic energy industry. Finley took various questions from PESA Members which ranged from the diplomatic efforts of the Trump Administration to how the outlook impacts energy transition and investment in renewables.

 PESA will continue to bring in experts to address the current market as it relates to the oilfield services and equipment sector.