The global rating agency said that low prices for an extended period could lead to more acquisitions of smaller, potentially distressed companies by larger ones, while reducing the major oil companies’ ability to finance their operations through disposals.
However, these changes are unlikely to occur should oil prices quickly rebound to above $A100/bbl, as happened in 2009, although the group only expects this figure to be the long-term price equilibrium for oil.
A Fitch spokesperson told PPO News this was based on the cyclical nature of the resources sector, with the long-term view being that there will be no change in demand.
The spokesperson added that while Brent prices are expected to remain at around $A70 in 2015, they’re expected to rise to around $A82 in 2016, before the long-term equilibrium sets in.