Grand Energy Oil and Gas Growth

The oil service sector has attained the status of bullish after a period of
stagnation. For the first time in roughly two years, the oil service sector can be
proud of the growth and projections ahead of it. Oil and gas, particular in U.S.
markets, is set to enjoy higher growth over the next few years as other sources
around the world are being held hostage for the sake of international negotiations,
arms deals, and political control.

As of late, the global oil market is starting to

tighten

Geopolitics have created the environment in which oil prices are rising at rates
faster than before, and those rates are rising in such a fashion that expectations
are now pinned at $100 per barrel for the year 2018. And there are many reasons
for this. Falkland Oil and Gas Ltd. successfully mobilized a rig spanning from West
Africa to the Falkland Islands as part of a drilling program in 2015. Russia, Turkey,
and Europe are currently entangled in the Nord Stream II debates while Chinese
investors are being considered for significant stakes in Russian strategic oil and gas
fields beyond those located on the continental shelf. Mexico opened a new round of
bidding in the recent past and Brazil has issued new energy concessions for the
first time since 2008 with oil and gas licensing having taken place in May of 2015,
an auction which embodies the new production-sharing agreements settled the
Brazilian energy sector and the financing from Petrobras.

In addition to production, the transportation of crude oil, petroleum products, and

natural gas remains paramount information for all oil-producing nations. Transit routes
are now indispensable lifelines and the shifting demand for oil and gas means
increased growth for future investors. That being said, helping the anticipated growth
is the fact that the energy market received a low S&P 500 weight coupled with high
short-interest which is now indicative of the fact that the supply and demand for all oil
based services is no longer balanced, a claim substantiated by the low price to
tangible book value for oil services and the mid-cycle earnings. It is anticipated that
as earnings bottom for the beginning of 2016, investors will start to focus on the fullscale upside, again, something substantiated by the low price to tangible book value
for oil services and the mid-cycle earnings.
Oil rig forecasts have indicated that the U.S. onshore market is responding to the
higher prices of oil in a very early cycle fashion. The reason for this is that it is the one
market wherein capital formation is actually growing and where the commodity
outlook demands a drilling response faster than the current upstream industry is able
to delivery with organic cash flow.
The distress currently felt in waves across the oil and gas market is a blessing in
disguise, something which will translate directly into accelerate recovery as soon as
demand increases, something that geopolitics dictates will happen within the next
two years. With tighter supply and aging equipment among HHP, contractors are
going to be called in to replace outdated equipment with new builds. This projection
will accompany the timeline of higher demand, and demand for balance for HHP in
particular.
Offshore driller stocks are set to benefit from the increasing fund slows into the
energy sector, more than other improvements in the fundamentals of the industry.
Because of the sheer size of the oversupply within the offshore rig market at present,
in tandem with the reduction in stacking costs, this segment market is not set to show
improvement until the year 2018 after which the industry will continue to earn its