Tags: Schwarzman | oil | investment | opportunities

Blackstone CEO Schwarzman: Oil Price Plunge Creates 'Very Unique' Investment Opportunities

By    |   Sunday, 21 December 2014 09:58 AM

For value-oriented investors the drop of oil prices — to yet another five-year low last week — presents an attractive buying opportunity in the energy sector.

And Blackstone Group, the world's largest private equity firm, is ready to pounce, says its CEO Steve Schwarzman,

"With a huge decline, there are going to be a certain number of companies under real stress, and that presents a very unique window," he told CNBC.

Schwarzman isn't worried about overproduction of oil. U.S. output has hit its highest level in at least 33 years.

"Like most commodities there's less of it produced at a certain point as the price goes down, and then things will normalize," he said. "Then the consumption of the world going up over time will result in prices going back again on the higher side."

But Blackstone isn't looking to invest in oil-producing Russia, as its problems are too grave, Schwarzman said.

"We have not bought a company in Russia in our firm's history. There is a reason to wait for some normalization between the great powers of the world before one starts investing in them."

As for oil, February U.S. crude futures settled at $57.13 Friday on the Nymex.

A Bloomberg survey of 35 analysts and traders shows that 43 percent expect prices to fall next week, 11 percent predict they'll rise and 9 percent anticipate little change.

"Investors are probably afraid to get any more short," Michael Lynch, president of Strategic Energy and Economic Research, told Bloomberg News.

"Prices have already fallen a great deal. There’s a fear that an event affecting supply or sentiment could happen at any moment."

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For value-oriented investors the drop of oil prices --to yet another five-year low last week -- presents an attractive buying opportunity in the energy sector.
Schwarzman, oil, investment, opportunities
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2014-58-21
Sunday, 21 December 2014 09:58 AM
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