Despite multiple macro headwinds, a case is building among some market watchers for oil prices to remain elevated and even rise meaningfully
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“You have all these factors that are very, very supportive of [higher oil] prices,” says Amrita Sen, co-founder and director of research at Energy Aspects Ltd. in London.“That tightness hasn’t even happened yet. The European embargo is about to kick in and that will lead to significant shifts,” she says.
“We’re overweight energy still. I’m bullish on energy and using it as an inflation hedge, as a portfolio hedge,” he says, noting that oil and related investments comprise anywhere between 10 to 15 per cent of his managed funds.The outlook for Canadian producers is relatively stable as well with oil sands producers, in general, demonstrating a disciplined approach to capital allocation despite robust cash flow generation right now.
Jennifer Tozser, senior wealth advisor and portfolio manager at Tozser Wealth Management with National Bank Financial Wealth Management in Calgary, says oil sands companies are “very lean now.”