After nearly two years of trials and tribulations, there is a sense of cautious optimism in the oil industry. Since prices dipped below $30 per barrel in February, both the West Texas Intermediate (WTI) and Brent benchmarks are hovering around the $50 mark and, despite the false dawn of early 2015, the broad consensus is that prices are on a chequered path to recovery.
The rollercoaster ride experienced by the full spectrum of market participants – producers, consumers and investors – has, in some ways, played out on banks’ commodity desks. “Mid-2014 seems like a decade ago,” says Jonathan Whitehead, global head of commodities markets at Société Générale Corporate & Investment Banking (SG CIB). “Back then, corporate hedgers weren’t scared and investors weren’t interested. No one really believed that there was going to be a significant amount of upside from the price levels, and there were more exciting things happening in other asset classes.”
