Oil Market Volatility Likely to Continue

Oil prices could see further short‑term weakness amid plunging demand and rising OPEC output, prompting producers to slash investment and shut in some wells. We worry less about the duration and more about the depth of the fall in oil prices, given the commodity’s self‑healing properties (high base decline rate). Although we believe oil is in a cyclical and structural bear market, we are finding compelling investment opportunities created by near‑term dislocations.