Raymond James - Energy Overview - 25 January 2016

U.S.
Research
Published by Raymond James & Associates
January 25, 2016
Energy
Industry Brief
Pavel Molchanov, (713) 278-5270, Pavel.Molchanov@RaymondJames.com
J. Marshall Adkins, (713) 789-3551, Marshall.Adkins@RaymondJames.com
Luana Siegfried, Res. Assoc., (713) 278-5277, Luana.Siegfried@RaymondJames.com
Victor Kalivas, Res. Assoc., (713) 278-5237, Victor.Kalivas@RaymondJames.com
Energy: Energy Stat of the Week __________________________________________________________________________________
Energy Stat: Amid the Sub-$30 Oil Freakout, Don't Lose Sight of the Fundamentals
Oh, the good ol days of $40/Bbl oil. It seems like it was only yesterday. Well, all right, it was early December, but sentiment on
energy has become even more brutal in the first three weeks of 2016. The intensity of the latest oil freefall may not seem to make
sense, but that doesnt make it any less painful. Today, we address some of the questions we have heard from investors over the
past few weeks. Specifically, we try to address the headlines that contributed to the ~25% collapse in oil to sub-$30 levels at the
lows of last week (i.e., the lowest since 2003). We believe first, ugly economic headlines from China are creating an erroneous
picture of Chinese oil demand trends; second, contrary to conventional wisdom, there is no imminent crisis with U.S. inventory
levels; and third, and also contrary to consensus, Iran is not a game-changer to the oil market now that sanctions have been lifted.
Finally, its important to underscore that oil prices have fallen to levels where cash operating costs are increasingly coming into play
for rebalancing the market. While there is no way to pin down the precise timing of the oil price bottom (it could have been last
week), we remain firmly of the view as we stated on January 4 that oil fundamentals will show a major improvement over the
next 6 to 9 months.
Chinese headlines are the main culprit of the latest oil meltdown even though Chinese oil demand is actually in good shape.
At the beginning of 2015, we estimated that Chinese oil demand would grow 3% for the year similar to 2014. In the second half of
2015, Chinese stocks began to nosedive, with the Shanghai Composite falling 32% by year-end from its peak in June. Against that
backdrop, China devalued its currency in August and tried all kinds of tactics to stem the bear market. None of it worked. Chinese
GDP grew based on official statistics 6.9% in 2015, a 25-year low. So, all this means that Chinese oil demand ended up
disappointing expectations, right? Wrong! In reality, based on actuals through 3Q15 and our 4Q estimate, Chinese oil demand in
2015 rose 6% not just 2x more than we had modeled at the start of the year, but considerably faster than in 2013 or 2014. Put
another way, Chinese oil demand growth in 2015 was about as fast as its GDP growth which is very unusual (in a bullish way) for
any large economy. The same, by the way, was true of the U.S. and Europe, but the main point were making is that Chinese oil
demand outperformed relative to expectations despite all
Oil Demand: Year-Over-Year Changes
the well-telegraphed macro headwinds of 2015. Put
another way price matters!
Region
2014
2015E
2016E
2017E
So now were watching Chinese stocks fall again. And,
just as we did last year, were hearing the doomsayers
predict that Chinese oil demand will turn negative in 2016.
Negative, really? With gasoline below $2/gal? Chinese
SUV sales were up 61% y/y in December! Are these cars
going to just disappear? Even if GDP growth slows down
even more in 2016, we believe it is virtually certain that
Chinese oil demand will increase y/y. As shown in the
adjacent chart, were already modeling the 2016 Chinese
oil demand growth rate cut by half to 2.7%. If anything,
our bias would be to the upside. For the record, Chinese
oil demand was flattish in 2009 and, despite some of the
headlines you might be reading, whats currently taking
place is not a re-run of the global financial crisis. On a side
note, oil demand in the rest of developing Asia
economies that are frequently tied to China is also
looking very healthy.
North America
0.3%
1.0%
1.9%
Europe
-1.5%
1.9%
0.5%
0.6%
0.0%
Pacific (mainly Japan)
-2.4%
-0.2%
0.1%
-0.5%
CIS (mainly Russia)
4.5%
-1.1%
0.5%
0.5%
China
3.5%
6.0%
2.7%
2.5%
Other Asia
2.0%
3.9%
3.2%
2.5%
Latin America
2.6%
-0.2%
1.0%
2.0%
Middle East
1.8%
1.3%
0.5%
2.0%
Africa
1.7%
2.3%
2.0%
2.5%
Regional Demand (RJ Est.) 0.9 MMbpd 1.7 MMbpd 1.5 MMbpd 1.1 MMbpd
Missing Bbls Adj. (RJ Est.) 0.2 MMbpd 0.3 MMbpd 0.0 MMbpd 0.0 MMbpd
Adj. Growth (MMBpd)
Adj. Growth (%)
IEA Estimate (MMbpd)
IEA Estimate (%)
GDP Data (IMF)
1.1 MMbpd 2.0 MMbpd 1.5 MMbpd 1.1 MMbpd

1.2%
2.2%
1.5%
1.2%
0.9 MMbpd 1.8 MMbpd 1.2 MMbpd

0.9%
3.4%
1.9%
3.1%
1.3%
3.4%
3.6%
Source: IEA, IMF, Raymond James research
Please read domestic and foreign disclosure/risk information beginning on page 8 and Analyst Certification on page 8.
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U.S. Research
U.S. Weekly Inventory Built/(Draw
But what about U.S. inventories? Havent storage concerns been hammering prices? Yes, but these concerns seem overblown.
In addition to Chinese demand, another driver of the most recent oil price rout has been oil storage concerns. This is somewhat
understandable given that U.S. Big Three petroleum inventory builds have been outpacing consensus forecasts since the end of
2015. For a few weeks, the trend even seemed to be accelerating a bit, as seen in the chart below. This obviously drove panic
among oil investors, most evident following the DOEs U.S. inventories report from January 6. That report showed a build of 11.8
MMBbls in Big Three inventories, which was 7.5 MMBbls higher than the consensus forecast. Following the release, WTI traded
down 6% for the day, and a total of 16%
U.S. "Big Three" Petroleum Inventories Build/(Draw)
over the following week, as storage
Consensus Estimates vs Actuals (MMBbls)
concerns were reignited. The next release,
16.3
on January 13, showed an even more
16.0
massive build of 16.3 MMBbls (10.3
11.8
MMBbls above consensus). The most
$37.36
11.0
recent datapoint, from last Thursday, was
$36.18
7.5
still bearish, though much less so. We
6.0
5.3
4.9
6.0
4.3
believe the sell-off on storage concerns has
been overdone, and it seems investors are
1.0
catching on, given the price bounce
$30.54
towards the end of last week.
(1.5)
(4.0)
$28.31
12/30/2015
1/6/2016
1/13/2016
1/21/2016
It is important for investors to understand
Consensus Inventory Estimates
Actual Build/(Draw)
WTI Opening Price (Morning of DOE Release)
why we believe storage concerns are
Source: Thomson One, DOE, Raymond James
overblown, despite what seems to be
consistently bearish U.S. petroleum
inventories data. At a high level, we estimate that the U.S. alone has 75-100 million Bbls of additional, easy crude storage plus
another 100+ million Bbls of product storage. Since our current oil model calls for about 1 million bpd of global oil inventory builds in
1Q16, the U.S. alone should be able to handle all of the potential (90 million Bbls) oil inventory needs. That said, it is unlikely that all
of this excess production will find its way to the U.S., for several reasons. First, since peaking in April 2015, domestic U.S. oil
production has fallen by about 350,000 bpd thats ~10.5 MMBbls per month! Despite recent WTI/Brent price incentives, all of this
production is not likely to be replaced by imports. Without more imports, U.S. builds should be ~35 MMBbls lower than last years
first quarter without even taking into account increased y/y demand due to the effect of cheap fuel. Second, there is oil storage
capacity elsewhere. While there isnt real-time data, increased Chinese and Indian SPR builds should help alleviate some of the
pressure on U.S. storage capacity. Third, if all else fails and U.S. oil storage does fill, the worst-case scenario we foresee happening is
a slightly increased contango in the futures curve in order to incentivize floating storage. Since some tanker rates have recently been
falling, we would surmise there is still available tanker storage capacity. While we plan to address all of these oil storage issues in
much greater detail in a future Stat, we felt it was important to touch on the main points today.
Iran is not about to flood the oil

the lifting of sanctions has been well-telegraphed (and likely over-estimated).
The re-entry of Iran into the global oil market is the most recent element of the oil market freakout, given the lifting one week ago of
Iranian economic sanctions. We doubt that
Iran Crude Production, 2011-2016E (MMbpd)
oil industry players truly saw this news as a
3.63 3.65
surprise, but plenty of media reports
EU embargo
3.53 3.51
Up 600,000 bpd?
hyped it up as yet another reason for
is announced
3.45 3.45
energy investors to panic. Here are the
3.37
3.35
facts about Iranian oil supply. First, while
Final nuclear
the exact date of lifting the sanctions
3.14
agreement is
3.05
most notably the European Union's oil
announced
embargo wasn't clear until this month,
2.85 2.87 2.85
2.84
2.82
2.81
2.81
the roadmap for getting to that point was
2.79 2.80
2.71 2.70
2.71
2.68
crystal-clear since July 2015, when the
2.64
nuclear agreement was signed between
Iran and six major powers. Thus, there is
1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15E 1Q16E 2Q16E 3Q16E 4Q16E
nothing remotely new or surprising in the
IEA
Reported
Iran
Crude
Production
Raymond
James
Forecast
Source: IEA, Raymond James Research
decision from January 16.
Second, Iran does not have millions of barrels per day of supply that it can bring online. When we compare current Iranian
production with its level in early 2012 (right before the EU embargo's imposition), the delta is about 600-700 Mbpd. This is the most
that Iran could possibly add to the global oil market at any point within the next year. In fact, the Iranian government has been
Raymond James
U.S. Research
guiding to 500 Mbpd and it will not all be added instantaneously. Even assuming the addition of 600 Mbpd by year-end 2016 our
assumption going back to the nuclear deal's original announcement in July 2015 our oil model still shows global inventories starting to
draw in 3Q16, with significant draws emerging in 4Q16. Longer term, as we pointed out in our Stat of the Week from March 2015,
Iran has the underlying resource potential to achieve organic production growth. Of course, this would require substantial increases
in investment, including foreign investment, which is out of the question at anything close to current oil prices. For the record,
Iranian production had posted declines every year from 2008 through 2011, even before oil sanctions ever entered the picture.
Current oil prices are at or near cash operating costs in a large number of areas thus, modest production shut-ins are underway.
The final apparent misconception we want to address is the issue of how low oil prices can fall in the near term. Unlike the question
of when will the bottom come, quantifying an oil price where producers begin to lose money producing is a possible task. Let's
start with a thought experiment. Let's suppose oil prices fall to $1/Bbl. Crazy, right? Yes, but why? The short answer is that no
producer in the world, not even Saudi Arabia, would agree to run oilfields while collecting that price per barrel. Production across
the board would shut down, a shortage of oil would result, and prices would rapidly recover. The point we are making here is that
cash costs (more precisely, cash field-level operating costs) will begin to force some oil producers to shut in production rather than
lose money. In many cases, it simply makes no economic sense for anyone to sell a barrel of oil when they would burn cash by selling
it. Cash costs explicitly do not include the sunk costs of finding and development (F&D) for the underlying resource, nor do they
include corporate expenses such as SG&A and interest expense. It is commonplace, especially these days, for oil producers to run
net losses but negative cash margins
Representative Ranges for Cash Operating Costs ($/Bbl)
are altogether different.
Cash costs span a wide range by region
and even within regions. By definition,
there is not a uniform number for the
entire spectrum of global oil supply. In
the adjacent chart, we show rough
These
are not precise figures but rather must be
seen as approximate, representative
ranges. We used the EIAs rather dated
(2009) cash cost dataset as a baseline,
adjusted by our internal extrapolations of
how costs have evolved since then.
Canada heavy
Venezuela heavy
UK/Norway
Brazil
Russia
U.S.
Nigeria
Canada conventional
China
Mexico
Iraq
Saudi Arabia
$0
$5
Source: EIA, Raymond James research
Brent
spot
price
$10
$15
$20
$25
$30
$35
At current spot prices of $32 WTI / $32 Brent, there is already a small amount of U.S. production that is running negative cash
margins, and wells are being shut-in. Keep in mind, those benchmarks do not tell the whole story. There are plenty of lesser known
crude grades especially, but not solely, heavy crude that carry sizable discounts. A textbook example is what's happening in
Alberta. Western Canadian Select is at $18, just about the lowest on record. There have already been scattered price-related
production shut-ins in Alberta; according to press reports, this number is at least 35,000 bpd. To clarify
Oil sands are less likely to shut down, because shutdown-related costs (take-or-pay contracts) and potential reservoir damage
outweigh the cost of producing oil sands at a negative cash margin for as much as 6 to 12 months. Other areas where at least some
operations are already at risk of negative cash margins include heavy crude fields in Central California and Venezuela, and highercost mature fields in the North Sea If WTI/Brent were to stay in the $20s, nearly all of the North Sea fields would become
uneconomic. Since the North Sea produces 1.4 MMbpd, halting even half of that would equate to more than canceling out whatever
supply increase Iran can manage within the next 12 months. Thus, our sense is that mid-$20s oil (or near the lows of last week) is the
lowest price that could be sustained for a period of months without a large amount (over 1.0 MMbpd) of production shut-ins.
Conclusion
It doesnt really surprise us that things have gotten worse before starting to get better in the oil market. Clearly, the start to 2016
represents an extreme example of a vicious cycle that we believe is fed by apparent market misconceptions and momentum. First,
there is the perception that Chinese oil demand is about to fall off a cliff, despite the fact that Chinese oil demand has been very
robust over the past year. Second, there are fears that global oil storage is at imminent risk of becoming physically overfull, even
though there is ample room in the U.S., internationally, and floating storage capacity. Third, while the lifting of Iranian oil sanctions
has been widely telegraphed (and modeled) since July 2015, apparently not everyone received the memo. Finally, there is the
undeniable fact that oil prices cannot stay below the level of cash operating costs for any length of time. Putting all this together, we
believe that the longer oil prices stay at current low levels near $30, the higher they will bounce towards the end of this year and
into 2017.
Raymond James
U.S. Research
Raymond James Weekly Oilfield Review
For Week Ending:
1/22/2016
12 Month Oil Calendar Strip
12 Month Gas Calendar Strip
Brent
Henry Hub
$130.00
$120.00
$6.00
$110.00
$100.00
$5.00
$90.00
$80.00
$4.00
$70.00
$60.00
$3.00
$50.00
$40.00
$2.00
$30.00
2011
Price
Percent Change
2012
2013
2014
2015
2011
2016
This
Week
Last
Week
Beginning
of Year
Last
Year
$35.71
$32.87
8.6%
$41.24
-13.4%
$54.26
-34.2%
Source: Bloomberg
2012
Price
Percent Change
2013
2014
2015
2016
This
Week
Last
Week
Beginning
of Year
Last
Year
$2.42
$2.38
1.8%
$2.53
-4.5%
$3.08
-21.5%
Source: Bloomberg
22-Jan-16
This
Week
15-Jan-16
Last
Week
23-Jan-15
Last
Year
Change From:
Last
Last
Week
Year
U.S. Oil
510
515
1,317
-1.0%
-61.3%
U.S. Gas
U.S. Miscellaneous
127
0
135
0
316
0
-5.9%
-59.8%
1. U.S.Rig Activity
U.S. Total
637
650
1,633
-2.0%
-61.0%
U.S. Horizontal
500
511
1,229
-2.2%
-59.3%
U.S. Directional
60
62
146
-3.2%
-58.9%
U.S. Offshore
29
26
54
11.5%
-46.3%
125
124
120
0.8%
4.2%
51
53
67
-3.8%
-23.9%
40.8%
42.7%
55.8%
-4.5%
-26.9%
457
516
937
-11.4%
-51.2%
250
0
227
0
432
NA
10.1%
NA
-42.1%
NA
139.3
1,906.9
16,093.5
165.9
136.3
1,880.3
15,988.1
151.9
193.4
2,051.8
17,672.6
335.9
2.1%
1.4%
0.7%
9.2%
-28.0%
-7.1%
-8.9%
-50.6%
242.9
241.1
451.6
0.8%
-46.2%
3,297
607
1,329,194
3,475
630
1,322,606
2,637
438
1,161,645
-5.1%
-3.6%
0.5%
25.0%
38.7%
14.4%
$32.19
$32.18
$14.59
$2.14
$3.69
$1.63
$4.57
$29.42
$28.94
$13.48
$2.10
$3.15
$1.63
$4.67
$45.59
$48.79
$20.49
$2.99
$6.44
$2.17
$6.84
9.4%
11.2%
8.3%
1.9%
17.2%
0.0%
-2.1%
-29.4%
-34.0%
-28.8%
-28.4%
-42.7%
-24.9%
-33.2%
U.S. Offshore Gulf of Mexico

Fleet Size
# Contracted
Utilization
U.S. Weekly Rig Permits *
2. Canadian Activity
Rig Count
Total Well Completions (Incl. Dry)
3. Stock Prices
(1/22/16)
OSX
S&P 500
DJIA
S&P 1500 E&P Index
Alerian MLP Index
4. Inventories
U.S. Gas Storage (Bcf)
Canadian Gas Storage (Bcf)
Total Petroleum Inventories ('000 bbls)
5. Spot Prices (US$)
Oil (W.T.I. Cushing)
Oil (Brent)
NGL Composite
Gas (Henry Hub)
Residual Fuel Oil (New York)
Gas (AECO)
UK Gas (ICE)
Sources: Bak er Hughes, ODS-Petrodata, API, EIA, Oil Week , Bloomberg

* Note: Week ly rig permits reflect a 1 week lag
Raymond James
U.S. Research
Raymond James Weekly Coal Review
For Week Ending:
1/22/2016
12 Month Big Sandy Barge Prices
12 Month Powder River Basin 8800 Prices
$90.00
$17.00
$15.00
$75.00
$13.00
$60.00
$11.00
$9.00
$45.00
$7.00
$30.00
$5.00
2011
Price
Percent Change
2012
2013
2014
2015
2016
This
Week
Last
Week
Beginning
of Year
Last
Year
$37.75
$37.90
-0.4%
$39.40
-4.2%
$46.75
-19.3%
Source: Bloomberg
1. Coal Prices
Eastern U.S.
CSX 1%
Western U.S.
Powder River 8800
2. Production
Eastern U.S.
Western U.S.
Total
2011
2012
Price
Percent Change
2013
2014
2015
2016
This
Week
Last
Week
Beginning
of Year
Last
Year
$9.95
$9.95
0.0%
$10.20
-2.5%
$12.25
-18.8%
Source: Bloomberg
22-Jan-16
This
Week
15-Jan-16
Last
Week
23-Jan-15
Last
Year
Change From:
Last
Last
Week
Year
$37.75
$37.90
$46.75
-0.4%
-19.3%
$9.95
$9.95
$12.25
0.0%
-18.8%
15-Jan-16
5,245
8,076
13,321
8-Jan-16
6,533
10,081
16,614
16-Jan-15
8,275
11,612
19,887
-19.7%
-19.9%
-19.8%
-36.6%
-30.5%
-33.0%
Source: Bloomberg
Raymond James
U.S. Research
U.S. Rig Count Breakdown

1/22/2016
Total Count
U.S. Rig Count
By Basin*
Permian
Eagle Ford
Cana Woodford
Bakken
Marcellus
Haynesville
DJ Basin
Utica
Mississippi Lime
Pinedale
Granite Wash
Arkoma Woodford
Barnett
San Joaquin Basin
Piceance Basin
Uinta
Powder River Basin
Fayetteville
Other
Drill For
Oil
Dry Gas
Wet Gas
Thermal
Trajectory
Horizontal Oil
Horizontal Gas
Horizontal
% Horizontal
637
197
70
52
44
33
18
17
14
11
10
8
7
4
4
3
3
2
0
140
1/15/2016
650
197
74
50
46
36
23
17
13
13
10
8
8
4
3
3
3
2
0
140
W/W
YTD
YTD %
Y/Y
Y/Y %
(13)
(1174)
-65%
(996)
-61%
0
(4)
2
(2)
(3)
(5)
0
1
(2)
0
0
(1)
0
1
0
0
0
0
0
-321
-169
-11
-133
-39
-22
-36
-32
-58
-8
-43
2
-16
-9
-9
-17
-30
-3
-220
-62%
-71%
-17%
-75%
-54%
-55%
-68%
-70%
-84%
-44%
-84%
40%
-80%
-69%
-75%
-85%
-94%
-100%
-61%
-274
-151
-10
-107
-37
-26
-32
-30
-51
-5
-29
2
-16
-6
-10
-10
-24
-6
-174
-58%
-68%
-16%
-71%
-53%
-59%
-65%
-68%
-82%
-33%
-78%
40%
-80%
-60%
-77%
-77%
-92%
-100%
-55%
510
45
82
0
515
50
85
0
(5)
(5)
(3)
0
(972)
(66)
(135)
(1)
-66%
-59%
-62%
-100%
(807)
(66)
(123)
0
-61%
-59%
-60%
0
402
98
500
78%
403
108
511
79%
(1)
(10)
(11)
0%
(687)
(148)
(836)
5%
-63%
-60%
-63%
(592)
(137)
(729)
3%
-60%
-58%
-59%
Source: Baker Hughes, Inc, Raymond James research

*Includes all trajectories
Raymond James
U.S. Research
Oil Rig Count
Horizontal Rig Count

1450
1650
1450
1250
1250
1050
1050
850
850
650
650
450
450
2012
2013
2014
2015
2016
This
Week
Last
Week
Beginning
of Year
Last
Year
510
515
-1.0%
536
-4.9%
1366
-62.7%
Rig Count
Percent Change
2012
2014
2015
2016
This
Week
Last
Week
Beginning
of Year
Last
Year
500
511
-2.2%
549
-8.9%
1253
-60.1%
Rig Count
Percent Change
Source: Baker Hughes
2013

6
Wet Gas Rig Count
Dry Gas Rig Count
600
400
350
500
300
400
250
300
200
150
200
100
100
50
2012
Rig Count
Percent Change
2013
2014
2015
2012
2016
This
Week
Last
Week
Beginning
of Year
Last
Year
82
85
-3.2%
103
-20.2%
200
-58.9%
2013
2014
2015
2016
This
Week
Last
Week
Beginning
of Year
Last
Year
45
50
-10.4%
59
-24.1%
110
-59.3%
Rig Count
Percent Change
Raymond James
U.S. Research
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safety of the dividend and expect a total return modestly exceeding the dividend yield over the next 12-18 months.
Raymond James
U.S. Research
Market Perform (MP3) Expected to perform generally in line with the S&P 500 over the next 12 months.
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Raymond James Ltd. (Canada) definitions
Strong Buy (SB1) The stock is expected to appreciate and produce a total return of at least 15% and outperform the S&P/TSX Composite Index
over the next six months.
Outperform (MO2) The stock is expected to appreciate and outperform the S&P/TSX Composite Index over the next twelve months.
Market Perform (MP3) The stock is expected to perform generally in line with the S&P/TSX Composite Index over the next twelve months and
is potentially a source of funds for more highly rated securities.
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and should be sold.
Raymond James Argentina S.A. rating definitions
Strong Buy (SB1) Expected to appreciate and produce a total return of at least 25.0% over the next twelve months.
Outperform (MO2) Expected to appreciate and produce a total return of between 15.0% and 25.0% over the next twelve months.
Market Perform (MP3) Expected to perform in line with the underlying country index.
Underperform (MU4) Expected to underperform the underlying country index.
Suspended (S) The rating and price target have been suspended temporarily. This action may be due to market events that made coverage
providing investment banking services to the company. The previous rating and price target are no longer in effect for this security and should
not be relied upon.
Raymond James Europe (Raymond James Euro Equities SAS & Raymond James Financial International Limited) rating definitions
Strong Buy (1) Expected to appreciate, produce a total return of at least 15%, and outperform the Stoxx 600 over the next 6 to 12 months.
Outperform (2) Expected to appreciate and outperform the Stoxx 600 over the next 12 months.
Market Perform (3) Expected to perform generally in line with the Stoxx 600 over the next 12 months.
Underperform (4) Expected to underperform the Stoxx 600 or its sector over the next 6 to 12 months.
Suspended (S) The rating and target price have been suspended temporarily. This action may be due to market events that made coverage
providing investment banking services to the company. The previous rating and target price are no longer in effect for this security and should
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Rating Distributions
Coverage Universe Rating Distribution*
Investment Banking Distribution
RJA
RJL
RJ Arg
RJEE/RJFI
RJA
RJL
RJ Arg
RJEE/RJFI
Strong Buy and Outperform (Buy)
55%
68%
59%
47%
22%
38%
0%
0%
Market Perform (Hold)
40%
32%
41%
37%
7%
16%
0%
0%
Underperform (Sell)
5%
1%
0%
16%
6%
0%
0%
0%
* Columns may not add to 100% due to rounding.
Suitability Ratings (SR)

Medium Risk/Income (M/INC) Lower to average risk equities of companies with sound financials, consistent earnings, and dividend yields
above that of the S&P 500. Many securities in this category are structured with a focus on providing a consistent dividend or return of capital.
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stream from dividends or distributions of capital.
Raymond James
U.S. Research
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and potential risk of principal.
High Risk/Speculation (H/SPEC) High risk equities of companies with a short or unprofitable operating history, limited or less predictable
revenues, very high risk associated with success, significant financial or legal issues, or a substantial risk/loss of principal.
Raymond James Relationship Disclosures

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next three months.
Stock Charts, Target Prices, and Valuation Methodologies

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10
Raymond James
U.S. Research
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Raymond James - Energy Overview - 25 January 2016

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January 25, 2016

Energy: Energy Stat of the Week __________________________________________________________________________________

Pacific (mainly Japan)

CIS (mainly Russia)

1.1 MMbpd 2.0 MMbpd 1.5 MMbpd 1.1 MMbpd

0.9 MMbpd 1.8 MMbpd 1.2 MMbpd

Source: IEA, IMF, Raymond James research

U.S. Weekly Inventory Built/(Draw

Iran is not about to flood the oil

12 Month Oil Calendar Strip

12 Month Gas Calendar Strip

U.S. Offshore Gulf of Mexico

Sources: Bak er Hughes, ODS-Petrodata, API, EIA, Oil Week , Bloomberg

12 Month Big Sandy Barge Prices

12 Month Powder River Basin 8800 Prices

U.S. Rig Count Breakdown

Source: Baker Hughes, Inc, Raymond James research

Horizontal Rig Count

Source: Baker Hughes

Source: Baker Hughes

Wet Gas Rig Count

Dry Gas Rig Count

Source: Baker Hughes

Source: Baker Hughes

Important Investor Disclosures

Ratings and Definitions

Investment Banking Distribution

Strong Buy and Outperform (Buy)

Market Perform (Hold)

* Columns may not add to 100% due to rounding.

Suitability Ratings (SR)

Raymond James Relationship Disclosures

Stock Charts, Target Prices, and Valuation Methodologies

This is RJA client

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