The head of Stone Energy Corp. in Lafayette told the quarterly meeting of the Louisiana Oil & Gas Association that he’s confident the oil and gas industry will bounce back, though he’s not sure when.
The Advertiser reports that David Welch, the company’s chairman, president and CEO, said the demand for energy is growing alongside the global population. Lingering low global prices for a barrel of oil, down to the mid-$40 range from a high of $112 in summer 2014, have driven some 100 exploration and production companies to bankruptcy, and others are simply holding on to get past prices that are driving down rig counts and eliminating oilfield jobs.
There is light at the end of energy’s tunnel, Welch suggested: In the $60- to $80-per-barrel range. But when prices reach that level, he said, is at best a guess.
Nonetheless, demand for oil is growing and has grown for several years. So has production, creating an oil glut that leaves the world market flood.
Welch said that—gradually—demand is closing the gap created by the oil glut. As the oil supply shrinks, prices will return, he said, adding that recovery may come in the foreseeable future, perhaps in the latter half of 2017 or 2018.
