Dahlman Rose On Oilfield Services

Dahlman Rose has published a research report on Oilfield Services and poses the question: is there a soft floor under natural gas prices? In the report, Dahlman Rose writes "Drawing from synergies with our Coal & Utilities and E&P teams, we see a potential debate emerging that favors thermal coal supporting natural gas prices, based on the futures curves of both commodities. If natural gas were to become more attractive on a relative price basis, as it is along parts of the 2011 strip, utilities may dispatch natural gas plants ahead of coal plants. If so, we estimate US natural gas demand may increase 2-8% potentially creating incremental rig demand of ~2% (~4% if calculated against natural gas rigs alone), which could shift the tone of natural gas sentiment to the upside." Companies related to this report include: Baker Hughes BHI Buy $56.25 PT: $90.00 Cameron Int'l CAM Buy $49.54 PT: $72.00 Dril-Quip DRQ Hold $77.22 PT: -- FMC Technologies FTI Hold $86.44 PT: -- Halliburton Company HAL Buy $39.89 PT: $68.00 Key Energy KEG Buy $12.54 PT: $16.00 Nabors Industries NBR Hold $21.84 PT: -- National Oilwell Varco NOV Hold $63.58 PT: -- Patterson-UTI Energy PTEN Hold $21.36 PT: -- Schlumberger Ltd. SLB Buy $81.34 PT: $119.00 Weatherford Int'l WFT Buy $21.99 PT: $34.00