There's No Business Like the U.S. Oil Pipeline Business: A 2013 Top 10 Wall Street Transcript Interview with Paul Sankey, Deutsche Bank Securities Inc.'s Lead U.S. Integrated Oil and Refining Analyst

Wall Street Transcript

67 WALL STREET, New York - December 9, 2013 - The Wall Street Transcript has just published its Top Ten Equity Analyst Interviews of 2013 Report. This special feature contains expert industry commentary through in-depth interviews with highly experienced Equity Analysts. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

Topics covered: U.S. Oil & Gas Pipeline Stock Recommendations

Companies include: Occidental Petroleum Corporation, Chevron Corp., Anadarko Petroleum Corp., Marathon Oil Corporation and many others.

In the following excerpt from the Top Ten Equity Analyst Interviews of 2013 Report, an experienced Oil & Gas industry analyst discusses the outlook for the sector for investors:

TWST: You expect 2013 to be the year of the pipeline. What developments do you think we will see and who will be the key players?

Mr. Sankey: Yes, so you've had a revolution in U.S. oil and gas, a total revolution. And what happened is, previously looking at a 30-year trend of falling supply in the U.S. and rising demand, we now have falling demand and rising supply. And essentially over 30 years, you developed infrastructure to increasingly import oil and gas in order to make up for the shortfall between rising demand and falling supply.

What's happened in the last five years is, we've turned into a market where certainly from the unconventional oil and gas revolution, supply is rising right when we've seen the peaking of oil demand and demand has started to fall, and there's also a total reversal of the dynamic of imports coming into the center of U.S. now turning into production coming from the center to the outside. So the net result has been that you had some massive breakdown in prices in various places where there simply isn't the right infrastructure which is designed to be the opposite of what it's required to do.

As a result of that, an enormous boom similar to what we saw in natural gas a few years ago is now happening in oil because of the very wide differentials and because of the economics of building pipelines to take advantage of these. We have 20 major pipeline projects being developed and starting in 2013 alone for about 4 million barrels a day of oil transport into Houston by 2015, which we think is the biggest single oil pipeline infrastructure addition ever seen in the world.

And by the way, we have same thing happening in 2014, another 20 pipelines for a similar amount for additional oil transport. So it's a huge story that I think a lot of people don't fully appreciate...

For more of this interview and many others visit the Wall Street Transcript - a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs, portfolio managers and research analysts. This special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

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