In a recent industry survey conducted by Ernst & Young, more than 200 energy executives indicated a cautious but generally optimistic outlook for oil and gas prices and expanded capital spending worldwide. The vast majority of those participating in the survey, conducted at Ernst & Young's 10th annual energy conference in Houston this fall, expect oil prices next year to be $1 to $3 per barrel higher than an anticipated 1999 average of $19 per barrel. However, during the next five years, they believe crude prices will fall below this year's average. The respondents' near-term views on natural gas pricing were far more bullish. More than 40% expect average natural gas prices in 2000 not only to be higher than average 1999 prices-which is the consensus view-but that those prices will exceed $4 per million Btu, says Janice Crawford, director of marketing for Ernst & Young's worldwide energy group. Again, the majority of the survey's energy executives expressed optimism about increased capital spending next year, with the largest group forecasting increases in excess of 10% over 1999's depressed energy spending levels. "Increases in international spending [on energy] are expected to be proportionately greater than those for the Gulf of Mexico and other U.S. areas," says Crawford. "Notable, but not surprising, was the view that relative interest in the U.S. and other mature areas like Canada and the North Sea will decline during the next five years, with interest elsewhere increasing substantially," she adds. -Brian A. Toal

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