The Country Caller believes the company’s latest move is to be indicative of the notion that the impact of the oil crisis still prevails
Coming ahead of the OPEC meeting ending on a positive note, oil and natural gas prices rallied, leading to a positive sentiment being raised in the energy market. This paved ways for oil and gas super majors to ramp up investments and their exploration and production plans. However, seems like the same does not apply to British super major, BP plc (ADR) (NYSE:BP).
Bob Dudley, CEO of the company says he is yet not willing to ramp up capital spending, despite the energy price rally. More so, he stated that the oil and gas company will maintain its capex level below $17 billion in 2017 and 2018. What surprises us that this figure happens to be as much as $6 billion lower than 2014, the year when the haunting economic slowdown in crude and gas prices begun. The Country Caller believes the company’s latest move to be indicative of the notion that the impact of the oil crisis still prevails.
In a conversation with Bloomberg on Tuesday in Switzerland, Mr. Dudley stated: “I think we are climbing very, very slowly out of a very tough period for the industry. Our focus now is to get our own engine moving again.”
On one side while the company is holding its capital spend level tight, it is aiming for growth on the flip side. According to Mr. Dudley, the energy giant is seeking to invest more than $4 billion on properties since the end of 2016. The company has also come out of paying a substantially material portion of the huge costs associated with the Gulf of Mexico oil spill. Hard to neglect the positive sentiment in the energy industry, Mr. Dudley also added how the company would now be well positioned to cover its payout from its income given that the price reached $55 per barrel in 2017. Both West Texas Intermediate and Brent crude continue to trade above $50 per barrel currently.