LNG, natural gas, and oil producers, oil and gas pipelines, and oil
refiners will be pressured by low demand and falling oil prices in 2016,
according to a new Fitch Ratings report.
"In addition to demand and pricing issues, the LNG industry is also
facing new liquefaction capacity coming on line," said Jelena Babajeva,
Director. "Additionally, market dynamics may drive lower throughput
across the value chain, including pipelines, LNG facilities and
refineries, due to domestic oversupply of natural gas and tepid global
demand for hydrocarbons."
Key factors affecting oil and gas include:
Oil and gas projects in the Middle East are exposed to market risk and
have seen a reduction in cash flows but remain resilient due to low
break-even prices.
Pricing pressures in Asia may intensify with the development of new
trading hubs, with incumbent producers protecting market share.
U.S. projects should be insulated from the impact of lower oil pricing
due to the contractual price risk transfer to corporate counterparties.
For more information, a special report titled 'Oil & Gas - 2016
Briefing' is available on the Fitch web site at www.fitchratings.com.
Additional information is available at 'www.fitchratings.com'.
Oil & Gas - 2016 Sector Briefing
https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=877913
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View source version on businesswire.com: http://www.businesswire.com/news/home/20160222006163/en/
Copyright Business Wire 2016
Source: Business Wire
(February 22, 2016 - 11:54 AM EST)
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