Insights

Equity markets declined for the second straight month amid the ongoing pandemic and lack of U.S. fiscal stimulus, as a new surge in coronavirus cases has put a damper on the energy demand recovery.

Broad equity and credit markets pulled back in September, and energy markets followed suit.

Despite stock prices that remain well below early 2020 levels, midstream earnings expectations have held up well.

The rebound in energy markets has sputtered over the past two months. Global crude production is likely to increase in the coming months, which could test oil prices previously stabilized by unprecedented supply cuts.

Concerns over spikes in COVID-19 cases weighed on energy sentiment in June. As global crude supply remains muted, further recovery in oil prices hinges on the return of demand in the U.S., the world’s largest energy consumer.

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