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Pioneer Natural (PXD) Expects Oil Demand to Recover by 2022

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Zacks Equity Research
·3 min read
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Pioneer Natural Resources Company PXD anticipates recovery in global oil demand by 2022 or early 2023, per Reuters.

While speaking at the Reuters Future of Oil & Gas 2020 virtual conference, the upstream energy company’s Chief Executive Scott Sheffield says that the recovery will be at 100 million barrels per day (Bbl/D) – the pre-pandemic level. Sheffield also projects that in 2021, demand for global crude oil will be at 97 million Bbl/D.  

In the Permian, the most prolific basin in the United States, Pioneer Natural has a significant presence. The leading oil and gas explorer and producer has restarted adding oil drilling rigs in the Permian. Notably, the company expects growth in oil production in the band of 0% to 5% for 2021, according to the source.

Since the coronavirus pandemic started denting global fuel demand, the price of crude has declined significantly as compared to 2020 beginning price of more than $60 per barrel mark. To survive in the low commodity pricing environment, Pioneer Natural confirmed on Oct 20 its $4.5 billion all-stock accord to acquire smaller rival Parsley Energy, Inc. PE.

It is to be noted that with the acquisition, Pioneer Natural will be able to bolster its presence in the Permian. Importantly, the combined firm will be able to save cost of $325 million annually, as estimated by Pioneer Natural. Thus, it has become increasingly evident that the oil industry is turning to acquisitions and mergers with an aim to cut costs that will help combat the pandemic-induced stretch of oil price slump.

Pioneer Natural Resources Company Price

 

Pioneer Natural Resources Company Price
Pioneer Natural Resources Company Price

Pioneer Natural Resources Company price | Pioneer Natural Resources Company Quote

Headquartered in Irving, TX, Pioneer Natural currently carries a Zacks Rank #4 (Sell).Meanwhile, a few better-ranked players in the energy space include DCP Midstream, LP DCP and HighPoint Resources Corporation HPR. Both the stocks sport a Zacks Rank #1 (Strong Buy).You can see the complete list of today’s Zacks #1 Rank stocks here.

DCP Midstream has seen upward estimate revisions for its 2020 bottom line in the past 30 days.

HighPoint is likely to see earnings growth of 167.5% in 2020.

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Pioneer Natural Resources Company (PXD) : Free Stock Analysis Report
 
Parsley Energy, Inc. (PE) : Free Stock Analysis Report
 
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