SINGAPORE (Dec 6): CIMB is upgrading the Singapore offshore and marine sector to “neutral” citing anticipated gradual uptick in crude oil prices in 2017 and the Singapore government schemes to alleviate working capital and capex needs of small players.

Lead analyst Lim Siew Khee notes that the sector will also face lower impairment risks in a higher crude oil price scenario, and diminished sector default risks for 2017 to 2018 as companies have extended their loan tenures.

The uncertainties posed by Trump’s vow for US to be energy independent could have accelerated OPEC and non-OPEC countries to cut production, notes Lim, as shale output remains resilient, with an 11% drop since 2015.

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