Oil and gas capital confidence barometer

Access to capital

  • Share

Credit conditions are of critical importance for companies to advance their strategic imperatives.

A willingness to use leverage and the view that credit availability is rising, signal a growing confidence in the long-term economic outlook and consequently a more robust deal-making environment. Conversely, a more conservative approach to leverage and increasing cautiousness on credit availability could signal a less robust deal market in the oil and gas space.

Please indicate your level of confidence in credit availability at the global level?

EY chart showing confidence in credit, 2014

Cash still the primary source of financing, but the appetite for leverage is increasing

At 42%, cash remains the primary source of deal financing for the oil and gas sector, but the cash share declined from 48% in the last October survey. In contrast, debt has been increasing as the primary source of deal financing in the oil and gas sector. Debt was seen as the primary source by 26% of oil and gas respondents in April 2013 survey, but rising sharply to 34% in our October 2013 survey and to 40% in our most-recent survey.

What is your likely primary source of deal financing in the next 12 months?

EY chart – oil and gas deal financing in the next 12 months

Other trends we observe include:

  • Mixed global deleveraging trends
  • Companies focusing on refinements