KUALA LUMPUR (Oct 31): OSK Research is maintaining its overweight stance on the oil and gas sector and its top picks are Kencana (Buy, FV: RM3.17) and Dialog (Buy, FV: RM3.66).
It said on Monday, with an improving global economic outlook and crude oil price having gone back to around US$90/barrel, it believes that O&G activities will gradually pick up, which would then benefit all O&G service providers through better utilisation rates and higher sales/unit or services/hour rates.
“On the local front, we expect the industry to be in for more marginal oilfield developments as well as the increasing need for brownfield services to boost O&G production while waiting for the commencement of deepwater activities on a large scale after pre-development preparations are completed,” it said.
It said on Monday, with an improving global economic outlook and crude oil price having gone back to around US$90/barrel, it believes that O&G activities will gradually pick up, which would then benefit all O&G service providers through better utilisation rates and higher sales/unit or services/hour rates.
“On the local front, we expect the industry to be in for more marginal oilfield developments as well as the increasing need for brownfield services to boost O&G production while waiting for the commencement of deepwater activities on a large scale after pre-development preparations are completed,” it said.
