"We expect earnings growth for the global integrated oil and gas industry of between 13-18 percent this year, assuming oil prices remain around the midpoint of our forecast oil price range of $40-$60 per barrel," Moody’s Senior Credit Officer Elena Nadtotchi stated.
The sector’s earnings declined 12 percent in 2016 and 40 percent in 2015 as oil and natural gas prices fell.
Moody’s noted that cuts in oil production will allow the oil and gas sector’s operating margins to improve as prices increase.
In November, OPEC member states reached an agreement to cut oil output by 1.2 million barrels per day for the first six months of 2017 in an attempt to boost oil prices.
Eleven non-OPEC countries, including Russia, Mexico and Kazakhstan, later joined the deal, pledging to voluntarily reduce production by 558,000 barrels per day.
