Energy lenders may believe oil and gas prices have passed their peak, according to a survey of 44 of these commercial-capital providers. For front-month oil prices, their average price expectations fell from the $50-per-barrel threshold they cited in the fourth quarter. Also, their gas-price forecast fell slightly, from $6.33 per million Btu. The results are according to global energy investment-banker and M&A advisor Tristone Capital Inc.'s eighth "Quarterly Energy Lender Price Survey" of regional, national and international reserve-based lenders. "Indications show certain lenders may believe prices have hit their high point and are settling below all-time highs," the firm reports. The lenders' five-year outlook shows a backwardated forward price deck for both oil and gas, with average 2011 forecasts of $42.60 for oil and $5.55 for gas. "Modest escalation of both oil and gas prices after 2010 is common, but prices are capped at an average of $43.02 and $5.32." Using a 60/40 blended gas/oil weighting, the firm compared the average "base case" against Nymex futures as of January 26, 2007. The average base-case results were 83% of Nymex futures in 2007, gradually trending downward to 74% by 2011. For more on this, see the March issue of Oil and Gas Investor. For a subscription, call 713-260-6441.

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