Investec duo: Do energy equities offer value right now?

ENERGY

Investec's Jonathan Waghorn and Mark Lacey on whether now is the time to buy high quality energy equities

Global energy equities have not been immune to the recent correction in global equity markets, with the European Integrated Index (SXEP) falling 22% in dollar terms over the last eight weeks, for example. Yet if this fall is compared to the performance of the underlying commodity exposure, with Brent crude prices falling only 9% and US natural gas prices actually rising by 12% over the same period, we would argue energy equities have been put under disproportionate pressure. Not only have high-quality names suffered indiscriminately, but the valuations now present in the sector have i...