Moody's: North American Shale Revolution Benefits Some Sectors, Disadvantages Others

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From Moody's Investor Service:
New York, May 13, 2013 -- North America's shale drilling revolution is now permanent and will keep natural gas selling at historically low prices for at least the next decade, Moody's Investors Service says in a new report. And while low natural gas prices will have long-term benefits for some sectors and companies, they will hurt other types of businesses, the agency says. 
"A surplus of natural gas production will give North American refiners and chemical producers a long-term competitive advantage over their peers worldwide, while the shale boom also improves the credit profiles of US electric and gas utilities," says Managing Director Steven Wood, lead author of the new report, in "Chemicals, Refining and Utilities Among Sectors Seeing Biggest Benefit from Shale." 
Natural gas currently sees little trade in the international marketplace, Wood says, with various difficulties in developing shale resources elsewhere keeping North America ahead of the game. 
Among the many refiners set to benefit are Phillips 66, Marathon Petroleum and Valero. With lower natural gas costs, they should enjoy strong cash flows in the intermediate term from North American crude oil selling below international benchmark prices.
Read more here. 


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