Summary of J.P. Morgan U.S. Oil Production Tracker Industry Overview - The report focuses on the U.S. oil and gas production forecasts, specifically the Lower 48 states (L48) through 2030, highlighting significant growth in oil production driven primarily by the Permian Basin. Key Points Oil Production Estimates - **2024 Oil Production**: Averaged 12.82 million barrels per day (MMBo/d), an increase of 344 thousand barrels per day (MBo/d) or +3% compared to 2023's average of 12.48 MMBo/d [2][3] - **2025 Oil Production Forecast**: Revised to 13.21 MMBo/d, indicating a year-over-year growth of 395 MBo/d, largely attributed to the Permian Basin's growth of 244 MBo/d [3][6] - **2026 Oil Production Forecast**: Estimated at 13.17 MMBo/d, indicating a flat year-over-year change [3][6] Natural Gas Production Estimates - **2024 Natural Gas Production**: Averaged 101.7 billion cubic feet per day (Bcf/d), a decrease of 777 million cubic feet per day (MMcf/d) or -1% from 2023 levels [2][7] - **2025 Natural Gas Production Forecast**: Expected to average 105.8 Bcf/d, reflecting an increase of 3.9 Bcf/d year-over-year, driven by growth in the Permian (+1.4 Bcf/d), Appalachia (+1.2 Bcf/d), and Haynesville (+0.9 Bcf/d) [3][7] - **2026 Natural Gas Production Forecast**: Anticipated to reach 110.5 Bcf/d, with significant contributions from Appalachia (+1.9 Bcf/d), Haynesville (+1.0 Bcf/d), and Permian (+0.9 Bcf/d) [3][7] Basin-Level Insights - The Permian Basin is identified as the primary driver of growth in both oil and natural gas production, compensating for declines in other regions [2][3] - **DUC Count**: The total U.S. drilled but uncompleted (DUC) well count decreased by 113 wells (-4%) to 2,964 in February, with notable decreases in the Permian and Appalachia basins [7] - **TIL Activity**: Total TILs (turn-in-line) decreased by 3 month-over-month to 937 in December, with declines in major basins like Haynesville and Appalachia [7] Market Dynamics - **Commodity Prices**: WTI prices fell by $1.26 per barrel to $72.70 per barrel, while the Brent/WTI spread narrowed to $2.05 per barrel from $2.69 per barrel [7] - **EIA Comparisons**: The report includes comparisons of J.P. Morgan's forecasts against the EIA's Short-Term Energy Outlook, indicating discrepancies in oil supply estimates for December and January [7] Additional Considerations - The report emphasizes the importance of updated modeling that incorporates activity levels, lateral lengths, cycle times, and decline rates to refine production forecasts [3][7] - The potential impact of increased U.S. LNG export capacity on natural gas demand is noted as a significant factor for future growth [3] Conclusion - The U.S. oil and gas production landscape is expected to see continued growth, particularly from the Permian Basin, with revised forecasts indicating a positive outlook for both oil and natural gas production through 2026. The report highlights the need for ongoing monitoring of market dynamics and production activities across various basins.

Summary of J.P. Morgan Global Commodities Research - Oil Demand & Inventory Tracker Industry Overview - The report focuses on the global oil industry, specifically analyzing oil demand and inventory levels as of January 2025. Key Points Oil Demand - Global oil demand increased by 1.5 million barrels per day (mbd) year-over-year in January, reaching a total of 101.5 mbd, exceeding monthly projections by 200 thousand barrels per day (kbd) [2][4][86] - The demand for heating fuels in the U.S. has surged, with the four-week average distillate demand at its highest since March 2022 [4][86] - In Asia, travel volumes during China's New Year holiday rose by 8% compared to the previous year, surpassing the forecast of 7% [4][86] - India anticipates a significant increase in travel due to a religious pilgrimage expected to attract 450 million devotees between January and February [4][86] Oil Inventories - Global observable oil inventories (crude and products) saw a net increase of 7 mb in the last week of January, driven by a 20 mb rise in crude oil inventories, partially offset by a 13 mb decline in oil product inventories [4][86] - Throughout January, global observable oil inventories experienced a drawdown of 78 mb, primarily due to a 58 mb reduction in crude oil stocks and a 20 mb decrease in oil product inventories [4][86] - OECD commercial oil stocks reported a net reduction of 24 mb in January, with a significant 31 mb reduction in oil product stocks, while crude oil inventories increased by 7 mb [3][4][86] Regional Insights - Five economies reported their oil consumption statistics, indicating varied trends across regions [4][86] - The U.S. saw a notable increase in crude oil inventories by 9 mb, marking the largest weekly increase since February 2024, while oil product stocks fell by 11 mb due to heightened demand for heating fuel [4][86] Additional Observations - The report highlights the impact of seasonal factors, such as winter heating needs in the U.S. and holiday travel in Asia, on oil demand [4][86] - The data suggests a potential continuation of upward momentum in oil demand into February 2025 [4][86] Conclusion - The analysis indicates a robust recovery in global oil demand, driven by seasonal factors and increased travel activity, while inventory levels reflect a complex interplay of supply and demand dynamics across different regions. The insights provided can inform investment strategies and risk assessments in the oil sector.

Summary of Conference Call on China Oil & Gas Equities Industry Overview - The conference call discusses the impact of Chinese tariffs on oil and gas imports from the US, specifically focusing on LNG and crude oil tariffs announced on February 4, 2025, which are 15% and 10% respectively [2][3]. Key Points Impact of Tariffs - The tariffs are considered mild compared to previous retaliatory tariffs from 2018-2020, which peaked at 25% on LNG and 5% on crude oil [2]. - In 2024, US LNG and crude oil imports accounted for only 5% (4 million tonnes) and 2% (10 million tonnes) of China's total imports, indicating minimal earnings impact on the oil and gas sector [2][3]. - Long-term contracts with US energy firms allow for rerouting supplies through alternative sources, further mitigating risks [2]. Company-Specific Insights - **PetroChina**: - Imported 1.2 million tonnes of LNG from the US under long-term contracts, representing about 10% of its total LNG imports. The estimated impact on 2025 earnings is near zero [3]. - **Sinopec**: - Expected to receive up to 4 million tonnes of LNG from the US if the Plaquemines LNG Facility starts operations in 2025. The worst-case scenario estimates a 3% impact on 2025 earnings due to the additional tariff [3]. - **Downstream Gas Utilities**: - Companies like ENN and China Gas are expected to face even less impact as they do not have direct long-term contracts for LNG imports from the US in 2025 [4]. Financial Projections - **PetroChina**: - Revenue projections for 2025 are estimated at CNY 2,898,763 million, with a net profit of CNY 169,782 million [20]. - Target price for H-shares is set at HKD 7.60, implying a 26.5% upside from the current price [19]. - **ENN Energy**: - Revenue is projected to grow from CNY 113,858 million in 2023 to CNY 139,187 million in 2026, with a target price of HKD 80.00, indicating a 56.6% upside [34]. - **Sinopec**: - Revenue is expected to decline slightly, with a target price of HKD 4.60 for H-shares, reflecting a 7.2% upside [19]. Risks and Considerations - Potential risks for PetroChina include overseas asset impairments, lower-than-expected oil and gas prices, and changes in tax/energy policies [19]. - For ENN Energy, risks include lower industrial gas demand and slower-than-expected growth in the integrated energy business [34]. - Sinopec faces risks from lower refining margins and potential LNG import losses [19]. Additional Insights - The strength and mix of volume at risk from the tariffs are viewed as minimal, suggesting that Chinese oil and gas companies should not be overly concerned [7]. - The overall market for fuel imports remains robust, with the impact of tariffs being contained [7]. This summary encapsulates the key insights and financial projections from the conference call regarding the Chinese oil and gas sector, particularly in light of the recent tariff announcements.

Summary of Key Points from the Conference Call Industry Overview - The report focuses on the oil industry, specifically the impact of recent sanctions on Russia's energy sector and the resulting implications for oil prices and market dynamics [1][2]. Core Insights and Arguments - **Brent Oil Price Movement**: Brent oil prices increased by 4% to $80 per barrel following the announcement of broad sanctions on Russia's energy sector, which targeted producers, shippers, traders, and insurers [1][2]. - **Sanctions Impact**: The new sanctions are estimated to affect vessels that transported 1.7 million barrels per day (mb/d) of oil in 2024, accounting for 25% of Russia's oil exports, predominantly crude oil [1][10]. - **Production and Price Forecast**: Despite high uncertainty, the base case for Russian oil production remains unchanged at 10.6 mb/d for 2025, with Brent prices expected to average between $70 and $85 per barrel [17][22]. - **Short-term Price Upside Risks**: The risks to the Brent price forecast are skewed to the upside in the short term, with potential prices exceeding $85 per barrel if Russian production drops by 1 mb/d [1][23][28]. - **OPEC+ Role**: It is assumed that OPEC+ will stabilize the market by utilizing its spare capacity and increasing production, limiting the long-term price impact of lower sanctioned supply [1][24]. Additional Important Insights - **Market Dynamics**: The report highlights that cold winter weather has tightened oil supply and demand dynamics, contributing to the price rally [4][5]. - **Changing Market Perceptions**: There has been a shift in market perception regarding the oil balance for 2025, with declining US crude inventories and effective OPEC+ compliance leading to a projected deficit in Q4 2024 [5][6]. - **Freight and Refined Product Markets**: The announcement of sanctions led to a 10% increase in global dirty tanker freight rates and a 3% increase in clean product tanker rates, indicating a significant market reaction [41][45]. - **Hedging Recommendations**: Oil producers are advised to hedge downside risks by taking advantage of the price increase and call skew through producer three-way options [40][36]. Conclusion - The sanctions on Russia's energy sector have created significant volatility in the oil market, with potential for both short-term price increases and long-term stabilization through OPEC+ actions. The report emphasizes the importance of monitoring these developments for investment decisions in the oil sector [1][23][40].

Summary of J.P. Morgan Oil Markets Weekly (10 January 2025) Industry Overview - The report focuses on the oil market, particularly the impact of U.S. sanctions on the Russian oil industry and the resulting price movements in crude oil [1][5][9]. Key Points Oil Price Movements - Oil prices reached a three-month high, with Brent crude increasing nearly 4% to $80 per barrel and WTI rising to $77 per barrel [1][5]. - The premium of Middle Eastern crudes over Brent has widened [1]. Sanctions on Russian Oil - A total of 451 vessels are now sanctioned, with 183 additional vessels added to the previous 268 [4][16]. - The newly sanctioned vessels include 211 oil-related tankers, which represent just below 16% of the total Russian tanker fleet of approximately 1,342 vessels [4][16]. - In 2023, these 211 vessels transported 1.7 million barrels per day (mbd) of crude oil and 200,000 barrels per day (kbd) of oil products, totaling 1.9 mbd [4][16]. - Over 80% of the crude transported by these vessels was sent to countries that may comply with U.S. sanctions [4][16]. Impact of Sanctions - The sanctions are expected to disrupt Russian oil flows more significantly than previous measures, increasing the cost of doing business with Russia due to the risk of secondary sanctions [13]. - China is reportedly becoming a less permissive buyer of Russian oil, with ports in Shandong province instructed to ban U.S.-sanctioned tankers from docking [13]. - Russia has adapted by acquiring its own fleet of tankers and insuring them domestically, redirecting oil shipments from Europe to Asia [14]. U.S. Inflation and Oil Prices - The sanctions and oil price dynamics have contributed to a significant disinflationary effect in the U.S., accounting for two-thirds of the drop in headline CPI inflation from a peak of 9.1% in June 2022 to 3.4% in December 2023 [10]. - Oil alone contributed 300 basis points to the decline in inflation [10]. Future Outlook - The report suggests that the new sanctions may provide the U.S. administration with leverage in future negotiations with Russia regarding sanctions [19]. - Other oil-producing countries may increase their market share at Russia's expense, with Chinese and Indian refiners seeking alternatives to Iranian and Russian crudes [18]. Price Forecasts - J.P. Morgan's crude oil price forecasts indicate that Brent prices are expected to average $73 per barrel in 2025, with WTI averaging $69 per barrel [31]. Additional Insights - The sanctions allow for a wind-down period, with tankers permitted to unload until February 27, and energy-related transactions continuing until March 12 [16]. - Rosneft and major oil trading companies supplying Russian oil were excluded from the sanctions, allowing them to engage in domestic crude swaps [16]. This summary encapsulates the critical insights from the J.P. Morgan Oil Markets Weekly report, highlighting the current state of the oil market, the implications of sanctions on Russian oil, and the broader economic context.

本文档仅供上海信鱼私募基金管理有限公司18860455898研究使用，请勿外传 On the downside, demand remains a key risk, with a slowing Chinese economy in focus. We are relatively cautious on 2025 oil demand growth (+1.1Mb/d), including for China (+0.2Mb/d). Slower Chinese demand (UBSe +4.0% GDP) and/or repercussions on tariffs and other headwinds could still bring demand growth lower. A larger surplus and lower oil price, falling below $70/bbl, could increase tensions within OPEC+ and risk weaker compliance. On potential stronger US supply gr ...

Summary of Key Points from the Conference Call Industry Overview - The report focuses on the **oil and gas industry**, specifically analyzing the **Brent crude oil market** and **non-OPEC supply dynamics** for 2025 and beyond [6][28][39]. Core Insights and Arguments - **Oil Market Surplus**: A surplus of approximately **0.7 million barrels per day (mb/d)** is expected in 2025, which will likely keep Brent prices around **$70 per barrel** [6][72]. - **Oil Demand Growth**: Projected oil demand growth for 2025 is around **1.0 mb/d**, which is at the lower end of the consensus range. Factors affecting this include below-trend global GDP growth, slowing population growth, and pressure on demand from China [6][12]. - **Non-OPEC Supply Increase**: Non-OPEC supply is expected to re-accelerate to **1.4 mb/d** in 2025, up from **0.9 mb/d** in 2024, driven by new projects in various countries [6][28]. - **OPEC Production Growth**: OPEC production is anticipated to grow by only **0.3 mb/d** in 2025, which includes **0.1 mb/d** from natural gas liquids (NGLs) and condensate [6][72]. - **Market Risks**: Key uncertainties include potential extensions of OPEC cuts, possible lower production from Iran, and risks to demand from tariffs [6][72]. Demand Dynamics - **Global Seaborne Energy Imports**: Growth in global seaborne energy imports halted in 2024, with a notable decline in crude import demand in Europe [7]. - **China's Demand Decline**: China's oil demand has decreased year-on-year for the past seven months, which is significant as China has historically accounted for half of global oil demand growth [15]. - **Refined Products Demand**: Demand for refined products is expected to grow by approximately **600 kb/d** year-on-year in 2025, but the market is currently trading in a weak seasonal period [12][14]. Non-OPEC Supply Insights - **Supply Growth Stagnation**: Non-OPEC supply has experienced stagnation over the last 12 months after a significant acceleration post-2022 price spikes [21][22]. - **Production Forecasts**: For 2025, consensus estimates suggest non-OPEC crude and condensate supply will re-accelerate to about **1.2 mb/d** [28][36]. - **Investment Trends**: Capital expenditures (capex) in the oil sector have recovered to over **$500 billion**, with attractive internal rates of return (IRRs) projected for upcoming projects [39][42]. OPEC Supply Dynamics - **Production Cuts**: OPEC has significantly lowered its future production plans, with output expected to grow again from April 2025 onwards [47][54]. - **Adherence to Quotas**: Various OPEC countries are showing differing levels of adherence to their production quotas, impacting overall supply [48][51]. Additional Important Insights - **Break-even Prices**: The median break-even oil price in US shale remains below **$50 per barrel**, indicating a wide distribution of costs among producers [45]. - **Market Balance**: The total oil liquids balance indicates a **0.7 mb/d surplus** in 2025, with potential for further tightening if OPEC+ cuts are extended [72]. This summary encapsulates the critical insights and projections regarding the oil market, demand dynamics, and supply forecasts, providing a comprehensive overview of the current state and future expectations within the industry.

Summary of GCC Economic Outlook Industry Overview - The report focuses on the Gulf Cooperation Council (GCC) region, analyzing economic growth projections amid a challenging oil market and geopolitical risks [1][7][64]. Key Economic Projections - **GCC Economic Growth**: Projected to accelerate to **3.2% in 2025** from an estimated **1.4% in 2024** [1][7]. - **Oil GDP Growth**: Expected to grow by **1.5% in 2025**, following a **3.2% contraction** in the previous year [8]. - **Non-Hydrocarbon GDP Growth**: Anticipated to be **4.0% in 2025**, slightly lower than the **4.4% projected for 2024** [8]. Country-Specific Insights - **Saudi Arabia**: Economic growth expected to expand by **3.2% in 2025**, with oil production averaging **9.0 million barrels per day (mb/d)**. Non-hydrocarbon activity projected to grow at **4.4%** [15]. - **United Arab Emirates (UAE)**: Growth set to accelerate to **4.2% in 2025** from **3.7% in 2024**, with oil production increasing to **3.54 mb/d** [21]. - **Qatar**: Projected growth of **2.8% in 2025**, supported by a **1.5% rise in oil activity** and a **3.5% growth in the non-oil sector** [31]. - **Kuwait**: GDP growth expected at **1.5%** after a **2% contraction** in 2024, with a focus on necessary fiscal and structural reforms [37]. - **Oman**: Economic growth projected to accelerate to **2.3%** in 2025, driven by a **1.1% growth in hydrocarbon GDP** [46]. - **Bahrain**: Expected growth of **2.7% in 2025**, with non-oil GDP growth projected at **3.0%** [55]. Risks and Challenges - **Geopolitical Risks**: Elevated geopolitical risks and uncertainties surrounding oil production trajectories pose significant challenges [1][64]. - **Oil Price Dependency**: GCC countries remain highly exposed to oil price fluctuations, which could impact their economic diversification efforts [64]. - **Budget Deficits**: The aggregate budget deficit for the region (excluding the UAE) is expected to widen to **5.5% of GDP** in 2025 from **2.5% in 2024** [8]. Policy Recommendations - Emphasis on **economic diversification** away from oil dependency is crucial for long-term sustainability [65]. - Strengthening **governance reforms** is essential to enhance the effectiveness of economic diversification efforts [66]. Conclusion - The GCC region is navigating a complex economic landscape with a cautious outlook for 2025, driven by both opportunities in non-oil sectors and challenges related to oil price volatility and geopolitical tensions [64][65].

Industry and Company Overview * **Industry**: Offshore oilfield services (OFS) * **Company**: COSL (China Oilfield Services Limited) * **Analyst**: UBS * **Date**: 2 January 2025 Key Points Industry Trends 1. **Offshore OFS Utilization and Day Rates**: The offshore OFS industry has been experiencing an upcycle since 2021, driven by rising oil prices and increased capex by global oil companies. Rig utilisation rates have been high, with average day rates for jack-ups, semi-subs, and drill ships increasing annually since 2022. * [2] 2. **Global Offshore Rig Utilization**: The average utilisation rate for offshore rigs in 2024 was 79%, with jack-up utilisation experiencing a temporary decline in Q324 due to service suspensions in the Middle East, followed by a recovery in Q424. * [2] 3. **Offshore Rig Day Rates**: Day rates for offshore rigs have remained on an upward trajectory in 2024, with rates for jack-ups, semi-subs, and drill ships increasing by 12%, 8%, and 16% respectively from the end of 2023. * [2] 4. **Global Offshore OFS Demand**: Global offshore OFS demand is expected to remain solid, with day rates for jack-ups, semi-subs, and drill ships projected to increase by 6%, 9%, and 9% respectively from 2026 to 2028. * [3] 5. **Regional Variations**: The Mediterranean, Southeast Asia, and Australia have seen the fastest growth in average day rates for jack-ups in 2024. Norway has maintained high day rates for semi-subs, with the average leading edge day rate increasing by 23% YoY. * [4] 6. **Rig Suspensions in the Middle East**: Some rigs in the Middle East were suspended from service in 2024 due to service suspensions. However, new contracts have been secured for a quarter of the suspended rigs, and demand is expected to recover in 2026. * [4] 7. **Supply Gap**: UBS expects a supply gap to emerge in 2030, requiring an investment of US$250-400bn/year to fill the gap, accounting for the natural decline at mature fields and the need for new projects. * [19] COSL Analysis 1. **COSL Drilling Business**: UBS has updated its analysis of COSL's drilling business and adjusted its 2024/2025/2026 earnings estimates. The company's drilling segment is expected to experience high growth in 2025, driven by new contracts for suspended rigs and higher day rates for some of its semi-subs. * [5] 2. **COSL Earnings Estimates**: UBS has adjusted its DCF-based price target for COSL from HK$10.80 to HK$10.60, implying a 10x 2025E PE. The company's 2025 net profit growth forecast is 40%. * [5] 3. **COSL Valuation**: COSL's 2025E PE of 6.6x is below the global OFS peer average of 11.9x, and its 2025E P/BV of 0.6x is below the global OFS peer average of 1.6x. * [5] 4. **COSL Rig Contracts**: UBS has provided a detailed breakdown of COSL's rigs subject to contract changes in 2025, including new contracts for suspended rigs and higher day rates for some of its semi-subs. * [40] 5. **COSL Financials**: UBS has provided a financial overview of COSL, including revenue, EBITDA, net profit, capex, EPS, DPS, ROE, and gearing ratio. * [42] Risks 1. **Oil Prices**: COSL's share price tends to track oil prices, which could impact sentiment on the stock. 2. **Deep-water Drilling**: The market may have higher earnings expectations for COSL from deep-water drilling offshore China, which faces higher risks than shallow-water drilling. 3. **Exchange Rates**: If the US dollar appreciates against the renminbi, there could be upside risk to COSL's earnings. 4. **Large Portion of Revenue from CNOOC**: While this represents reliable revenue, there is a risk that COSL may not raise rates in line with overseas peers. * [48]

Summary of Global Oil and Gas Conference Call Industry Overview - The conference call focused on the **Global Oil and Gas** industry, providing insights into various companies within this sector. Key Companies Discussed 1. **BP** - Local Price: 379.1 GBp - Target Price: 525 GBp - Upside: 39% - Rating: Buy - 2024E P/E: 4.6x, FCF Yield: 8.7% [4][4][4] 2. **Chevron** - Local Price: 142.85 USD - Target Price: 195 USD - Upside: 37% - Rating: Buy - 2024E P/E: 8.0x, FCF Yield: 9.6% [4][4][4] 3. **ExxonMobil** - Local Price: 105.87 USD - Target Price: 147 USD - Upside: 39% - Rating: Buy - 2024E P/E: 8.1x, FCF Yield: 7.9% [4][4][4] 4. **Shell** - Local Price: 2,395 USD - Target Price: 2,800 USD - Upside: 17% - Rating: Neutral - 2024E P/E: 4.1x, FCF Yield: 16.4% [4][4][4] 5. **TotalEnergies** - Local Price: 51.89 USD - Target Price: 67.0 USD - Upside: 29% - Rating: Buy - 2024E P/E: 4.6x, FCF Yield: 10.2% [4][4][4] 6. **Eni** - Local Price: 12.72 USD - Target Price: 15.5 USD - Upside: 22% - Rating: Buy - 2024E P/E: 3.9x, FCF Yield: 8.4% [4][4][4] 7. **Equinor** - Local Price: 254.5 NOK - Target Price: 280 NOK - Upside: 10% - Rating: Neutral - 2024E P/E: 4.2x, FCF Yield: 11.0% [4][4][4] 8. **Cenovus Energy** - Local Price: 14.42 CAD - Target Price: 33 CAD - Upside: 129% - Rating: Buy - 2024E P/E: 5.0x, FCF Yield: 17.3% [4][4][4] Core Insights and Arguments - The overall sentiment in the oil and gas sector remains positive, with several companies rated as "Buy" due to their strong fundamentals and growth potential. - The projected earnings and cash flow metrics indicate a favorable outlook for many companies, with significant upside potential noted for companies like Cenovus Energy. - The analysis includes various financial metrics such as P/E ratios, FCF yields, and target prices, which are essential for evaluating investment opportunities in the sector. Additional Important Information - The report highlights the importance of free cash flow (FCF) yield as a critical metric for assessing the financial health of oil and gas companies. - The conference call also discussed macroeconomic factors affecting the oil and gas industry, including global demand trends and geopolitical risks that could impact pricing and production levels. - The data presented is based on estimates and market conditions as of December 2024, indicating the need for ongoing monitoring of the sector for potential investment opportunities and risks [4][4][4].