1. What is driving current performance in the energy sector?
The recent selloff in pipeline related investments coincided with a downturn in the price of crude oil, which currently is the key driver of energy market sentiment. Energy investors continue to see inventories build in the U.S. despite OPEC’s reduction in crude oil supplies.
Saudi Arabia’s rhetoric is unclear about whether the OPEC cuts through the first half of the year are likely to be extended to the second half. At Tortoise we think the rhetoric is about maximizing OPEC member compliance, and expect the cuts to be extended.
