Let’s face it. Energy was the worst-performing market sector last year, the latest in a string of years in which it’s disappointed. Yes, unpredictable presidential policy as regards Middle East issues—notably, waivers to purchase Iranian oil—played a part. But sentiment at year-end could scarcely have been worse, as scores of stocks hovered near 52-week lows.
If any tidings of comfort and joy existed, they were overshadowed by a variety of factors: broader stock-market volatility and its relationship to risk assets, including oil markets; E&P valuations bearing little resemblance to historical metrics; the majors boosting production in the Permian; talk of a persistent oil glut; weaker OPEC influence over global markets; etc.