Junior Oil Firms: Not All Doom and Gloom

"The question is actually what happens then because there are some banks … who have lent an extraordinary amount of money to the shale oil industry in the United States … So, what are those guys going to do? Are they going to shut down or are they going to keep it going under the assumption that oil prices will recover soon?"

Henderson is hopeful that we are close to a floor for oil prices.

"I think the key is just what works economically. The collapse has been technically driven as much as fundamentally driven. To suggest that the fundamentals have changed as much as the move in the oil price would suggest within the last six months is ludicrous. Basically, you had a market that was ridiculously long in the summer of last year and then you had a rush to correct that and that has driven the price down and it is driven by momentum traders at the moment."

Many junior oil firms will be hoping he is right.


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