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Quarter-End Insights

Energy: Supply Glut Continues, but Some Respite on Pricing

The glut in crude supply will take several more quarters to work through.

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  • Declining U.S. oil production over the next several quarters will help reduce global oversupply, but that alone won't fix the imbalance before 2017.
  • Reduced investment will eventually translate to stronger output declines and help markets rebalance.
  • Energy sector valuations are a bit frothy at current levels.


Peggy Connerty does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.