Doug/ Oil pricing - here's some related views sniped from
#reply-4862890 at Kerm's Korner. The last sentence mentions some of recent forward-look views......... also, re: oil keep in mind that the only predictable thing about pricing is that it's unpredictable.
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NEW YORK, June 12 - Deutsche Bank Securities said Friday it has trimmed its earnings estimates for 17 oil services companies because the outlook for crude prices looked bleak.
''We believe that the past week has ushered in a sea change in the oil price outlook,'' said Wesley Maat, Deutsche Bank Securities' oil services analyst.
On Thursday, crude traded on the New York Mercantile Exchange plunged to $12.70 per barrel, its lowest level in almost 10 years as the market dismissed attempts by three key producers to initiate a round of output cuts.
''We believe producers will sharply curtail their non-ultra deepwater drilling budgets in response to the prospects of $12 to $15 per barrel oil prices in the second half of 1998 and a $16 average oil price next year,'' Maat said in a report.
Deutsche has trimmed its 1998 and 1999 earnings per share forecasts for the 17 oil services companies by an average of 9.0 to 11 percent, respectively.
The reduced EPS forecasts assumes that natural gas prices do not go below $2.25 per million British thermal units in 1998 and $2.50 per MMbtu in 1999.
Deutsche cut the stock rating to hold from a buy on BJ Services Co. (BJS), Cliffs Drilling Co. (CDG), Cooper Cameron Corp. (RON), Dresser Industries Inc. (DI), ENSCO International Inc. (ESV), Global Marine Inc. (GLM), Halliburton Co. (HAL), Marine Drilling (MDCO), R&B Falcon Corp. (FLC), Rowan Companies Inc. (RDC), Santa Fe International (SDC), and Schlumberger Ltd. (SLB).
Noble Drilling (NE) and Smith International Inc. (SII) were cut to hold from accumulate.
Deutsche said it has a buy rating on Diamond Offshore Drilling Inc. (DO), Transocean Offshore (RIG), Varco International Inc. (VRC), and Petroleum Geo-Services (PGSO.OL).
Deustche said its Energy Research Group is lowering its oil price forecast to $15 per barrel for 1998, down from $16, and lowering its 1999 forecast to $16 from $17.
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