Summary

• In late May, energy executives were highlighting the rapid depletion of global inventories and the risk of an oil price spike.
• With a potential peace deal and reopening of the Strait in the works, Brent oil prices fell below $90 per barrel last week and saw more pressure on Monday, but that doesn’t mean oil prices won’t rise from here.
• Instead of focusing on day-to-day oil price moves, midstream investors should be keeping an eye on futures prices, which are over $70 per barrel next year for the U.S. benchmark and will be more impactful for producer drilling plans.

By Stacey Morris, CFA

While prices at the pump in the U.S. were easing in late May, oil industry veterans were sounding the alarm on depleting inventories and a potential oil price spike. Since then, there have been