No one could’ve seen the energy market disruptions of 2020 coming, and most of us are ready to write off what has been one of the most challenging years the industry has seen in a long time. Yet the events of the past year will most certainly define what unfolds in the New Year and beyond. To make sense of what 2020 will mean for the post-COVID era, we retooled and refreshed our models and forecasts to tackle the hard questions facing U.S. crude oil, natural gas, and NGL markets. As it turns out, beyond the immediate chaos of the pandemic, there is a new order taking shape, and that’s what we laid out in the RBN Fall Virtual School of Energy, sharing our results and the Excel spreadsheets behind the models to get you ready for what’s coming. Some of what we expected has come to fruition, and we still think that there is a pretty good chance that the rest will unfold in the months and years ahead. If you weren’t able to join us for the live broadcast, we invite you to sit by the fire, put your feet up and dig in over the holidays. The entire 14+ hours of streaming content, plus slide decks and spreadsheets, are available online. Today’s advertorial blog provides highlights from our key findings and the overall conference curriculum.
Cataclysmic events have a way of perforating time into the “before” and “after” for those living through it, and the pandemic this year has certainly been one of those events. Many aspects of life and work were upended this year, including for the energy sector. With oil and gas prices and demand plunging to historical lows, what was the modus operandi before the pandemic no longer made sense after, and what had gone against all conventional wisdom before, suddenly was the norm after. Shale producers who had shunned the idea of economically driven, short-term wellhead shut-ins, made the decision to temporarily shut-in existing wells. Global offtakers for U.S. LNG exports who had reliably taken contracted cargoes for four years, broke rank and canceled more than 150 cargoes this summer as international gas demand and price spreads were crushed. Those are just a couple of examples of the anomalies this year. Some of the market behavior will eventually revert to some semblance of what it was before. Other things will never be quite the same.
So that’s the framework with which we approached School of Energy this fall. We assessed how the markets were affected by and adapted to the turmoil of 2020, and — based on what we know so far and a rigorous analysis of fundamentals using RBN’s energy models — we put forth our best efforts at reimagining the rulebook of how the markets will operate in a post-COVID world.
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