Oil prices have probably bottomed: Woodside

Matt Chambers, Daniel Palmer
MAY 20, 2016
THE AUSTRALIAN
Woodside Petroleum chief Peter Coleman says oil prices have probably bottomed and are likely to firm, but he doesn’t think a strong rebound is on the cards, warning prices will remain “rangebound” as gains inspire more production.
Mr Coleman is fronting investors in Sydney this morning in the company’s annual investor briefing day.
“We think there will be a firming over the next 18 months,” Mr Coleman said.
“We’re not going to see any real increase in prices … but we’ve probably bottomed out in a range.”
He said supply could come back on quite quickly, which could dampen gains.
On LNG, where analysts have recently expressed concerns about Woodside’s exposure to spot prices, Mr Coleman said he was not surprised at the state of the market and predicted improvement in LNG prices in 2018.
“We knew there was going to be a short-term oversupply — we’re not sure what the brou-ha-ha is about,” he said.
Woodside sees a silver lining to the lacklustre near-term market however, as it drives a “fundamental and positive change” in the buyer relationship with new players joining the industry.
“Low prices actually mean new markets,” he said.
“New players are coming into the market almost weekly.”