2014 Looks Like Another Difficult Year For European Oil

Demand for energy never goes down, but it is fairly elastic to changing prices. The oil shocks of the 1970s finally led to demand peaking out in 1979 and according to this article, entered a period of stagflation.

On a global basis, that demand level was again seen only 10 years later, in 1989. Significantly, European oil consumption is still 5% below its historic high of 1979.

In their Vision for European Oil and Gas for 2014, Citi analysts Alastair R Syme, Michael J Alsford, Ryan W Kauppila, Mukhtar Garadaghi, David A Byrne and Nikhil Gupta say that the outlook for both earnings and returns “look challenging.”

European Oil: Deflationary pricing

Since the beginning of 2012, European oil stocks have under-performed the...