UBS sees global oil demand to counter hawkish cenbanks amid tight supply

STO

08/07/2022 04:19

** UBS says disruptions to oil supply globally will continue
to support crude prices and help limit downside risk from
slowing demand
    ** Broker lifts forecast for North Asian spot LNG prices by
~40% on average over 2022-26 primarily due to faster decline in
Russian gas exports to Europe
    ** Says direct correlation between European gas hub prices
and North Asian spot LNG prices provides a material cash
injection to Australian exploration and production cos
    ** Adds Woodside Energy  WDS.AX  has high spot LNG exposure,
hikes PT to A$34.25/share from A$32.00/share and upgrades to
"buy" from "neutral"
    ** UBS picks Santos Ltd  STO.AX  as most preferred stock
ahead of WDS, Origin Energy  ORG.AX  and Beach Energy  BPT.AX 
    ** Broker cuts PT on STO to A$9.50/share from A$9.70/share,
sees asset sell-downs to support stock re-rate
    ** UBS notes that oil demand is typically resilient against
slowing global growth, it takes a recession to drive the decline
    ** We see the release of pent-up demand post COVID-19
continuing to support demand growth in the near term - UBS
    ** As of last close, WDS shares up 38%, BPT up 30.2%, while
STO down 68.5% this year
    

 (Reporting by Savyata Mishra in Bengaluru)
 ((Savyata.mishra@thomsonreuters.com))