Oil prices continued their losing streak Tuesday, as West Texas Intermediate (WTI) reached US$68.9 per barrel late afternoon Tuesday.

Eric Nuttall, partner and senior portfolio manager at Ninepoint Partners, told BNN Bloomberg on Tuesday that oil investor sentiment is “deplorable” and “back to historic lows,” noting that oil prices have sold off for about seven consecutive weeks.

Nuttall said there are “massive diversions” in the market as fundamentals have weakened, while supply has grown more than anticipated amid strong demand and global inventories remain at their lowest levels since 2017.

In light of these headwinds, Nuttall advised that oil investors look to specific companies in the year ahead.

“I think next year is very much a stock picker’s market,” Nuttall said in a television interview. “You’ve got to pick the right stocks.”

This spring, Nuttall predicted oil would hit US$100 per barrel by the end of 2023, but he has since revised that estimate as he looks to the year ahead.

“We think oil should be looking at a fundamental floor of about $80 (per barrel), (with a) ceiling no higher than $90,” he told BNN Bloomberg on Tuesday. “We're using $80, it's our base case.”

NATURAL GAS

Nuttall also highlighted that LNG Canada should be operational at some point in 2024 – which he sees as a reason to be “bullish” on natural gas.

LNG Canada is a joint liquefied natural gas venture made up of five energy companies. 

Bloomberg News reported in October that the construction of the Coastal GasLink pipeline was completed, indicating LNG’s project in Kitimat, B.C., capable of liquefying 14 million metric tons a year, is on track. 

CANADIAN ENERGY

Nuttall said he is bullish on the outlook for Canadian energy stocks in 2024, pointing to their strong balance sheets with regards to free cash flow.