A sample of energy industry experts attending the Dain RauscherWessels Energy Conference expects prices to strengthen toward theend of this year, only to give way to general price weakness in2000. Many of the 146 people polled at the conference said theyexpected gas prices to surge towards $3.10 before the end of thisyear, then fall to the $2.50 level in early next year. Overall, 800energy industry experts, company representatives, institutionalinvestors and securities analysts attended the four-day conference,which ended yesterday.

The poll was distributed to all attendees. Respondents wereasked six questions about oil and gas prices, stock performance andenergy companies likely to merge. Answers to the pricing questionswere averaged to calculate the results.

“The results reflect some skepticism about the current commodityprice environment,” said Jim Wicklund, managing director and headof energy research at Dain Rauscher Wessels. “However, theexpectation is that prices will be high enough to continue pushingstocks and activity higher. They all believe the oil patch recoveryhas started.”

The fact that many in the industry are not bullish about pricein 2000 is an effect of the previous warm winters, Wicklund said.”We assume that the record warm winters seen over the past twoyears have made many of the participants somewhat cynical.”

Yet, despite what others in the industry feel, Wicklund is abull. “Overall, considering the very harsh operating environmentthe oil and gas industry has seen over the past 18 months and howweak the cyclical recovery has been so far, the consensus outlooksare actually very bullish.”

Oil prices were predicted to retreat slightly from the currentprice of $24 per barrel to $22.70 by the end of this year with anaverage price for the year 2000 placed at $20.70. The poll alsofound that the vast majority of respondents believed that crude oilproduction would increase over the next year by an average of 2.7percent.

The group also took a stab at the next merger candidates,answering that Chevron and Texaco were the “favorite pair for asuccessful marriage of oil companies.” Nearly every oil companymade the list, but those two companies were included in more than15% of the survey responses.

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