CVE/long
Crack spreads near $60/bbl and collapsing global inventories prove oil demand is strong, not destroying — Canadian SAGD producer CVE rips as $70 oil reprices toward supply-clearing levels.
At $70 a barrel of oil, we are stampeding to the next problem: high oil prices over the longer term.
Peak-
IMO/long
Imperial Oil's SAGD assets earn high-teens returns at $70 oil and trade near 2x capital while a 4M barrel/day multi-year supply gap points to structurally higher prices.
These companies are producing strong returns on capital at $70 a barrel. We'd estimate this to be in the high teens, while they invest in growing marginal production on existing assets.
Peak-