Oil company CEO sees recovery — someday

daily advertiser-01The Advertiser | September 20, 2016 | Ken Stickney

David Welch said Wednesday he's confident the oil and gas industry will bounce back.

He's just not sure when.

Welch, chairman, president and CEO of Stone Energy Corp. in Lafayette, told the quarterly meeting of the Louisiana Oil & Gas Association that world population is growing and as population grows, so does the demand for energy. Some 60 percent of the nation's energy comes from oil and gas, he said.

But lingering low global prices for a barrel of oil, down to the mid-$40 range from a high of $112 in summer 2014, have driven some 100 exploration and production companies to bankruptcy, and others are simply holding on to get past prices that are driving down rig counts and eliminating oilfield jobs.

There is light at the end of energy's tunnel, he suggested: In the $60- to $80-per-barrel range. But when prices reach that level, he said, is at best a guess.

Welch said at least one respected analyst says oil will never again reach $55 a barrel. Another has suggested $120-a-barrel oil is on the horizon.

Likewise, some economists suggest that the oil and gas industry is doomed, and may disappear by 2030, while most economists say there's another 50 to 100 years of life left for the oil industry.

Nonetheless, demand for oil is growing and has grown for several years. So has production, creating an oil glut that leaves the world market flood.

Read the full story here.

National Ocean Industries Association
1120 G Street, NW • Suite 900
Washington, DC 20005

Phone: 202.347.6900 | Email: media@nullnoia.org