Live on Bloomberg TV

00:00Brian what are you plugging in in terms of your expectation for an oil price. A OPEC is is going to give us the news tomorrow. How important is that. Where do you expect the oil price to go in the United States. We're obviously watching what the Biden administration is going to do. I'm just curious as to the kind of big top down macro drivers impacting this sector. Look we think we could see oil prices into the 60s WTI later this year and stick their in in 2022. And so when we plug that in our estimates for the DA about 13 to 15 percent above consensus and we think again that can be a tailwind given some of the skepticism on the sustainability of this of this oil price move that we've seen. One of the questions is going to be how do some of the producers that we cover respond. Because there is a lot of focus on capital discipline. Our view is that we are going to see that stick. But there's a lot of investor skepticism on that. And that's because down cycle discipline is easy. But up cycle discipline is harder and investors are going to be watching. I think these these companies very closely as we go through not only this quarterly earnings season but the next couple to make sure that just unfolds because that would support not only the higher oil price that that we're forecasting but also strong free cash flow yields. All right. Two question for you. The first one Brian is we had a list of your top picks. It was like Devon and EOG and those names do have exposure to federal lands. You can make an argument that you won't really feel that in terms of their inventory for a couple more years because they already have other leases and permits. But how do you model that kind of potential risk of the next couple of years. It's a great question and we've tried to look and say if there are no additional permits that are issued on the existing leases then what is the lost value. And then we're in the stocks trade today relative to that value. And you know given the underlying tailwinds of the commodity price view that we've talked about here we still see value for the defense and the EOD and the summer axes of the world which are three stocks that we like. But we understand that people want to build a portfolio and there are stocks that we also like that don't have exposure to federal land likes like Pioneer Natural Resources. So you know this is one of four overhangs on on stocks along with short term demand concerns long term demand concerns and capital discipline. We do think we're gonna add some greater clarity on this but we certainly understand it's a risk including some of the stocks that we like.

No schedule data available.

Why Goldman Sees WTI Above $60 and 'Stick There' in 2022

Goldman Sachs Senior Oil and Gas Equity Research Analyst Brian Singer discusses the outlook for oil on "Bloomberg Markets." (Source: Bloomberg)

More From Bloomberg Markets
All episodes and clips

Bloomberg Technology
The only daily news program focused exclusively on technology, innovation and the future of business from San Francisco. Hosted by Emily Chang.
More episodes and clips