4 Energy Capital Markets  Current global recession  Global oil demand expected to decline 0.6% in 2009  US natural gas demand expected to remain flat for 2009  Uncertainty of new administration  Volatility of current equity markets  Ongoing credit crunch  Necessity to shore up liquidity position  Decrease in borrowing bases by 15 percent to 20 percent (3)  OPEC is dependent of oil prices around $50.00/bbl to fund domestic programs and capital investments (1)  December production cuts of of 2.2 mmb/d; previous cut of 1.5 mmb/d in October  2H 09 Forward curve average of ~$56.00/bbl (2)  Tax cuts / economic stimulus package  Institutions on sidelines  E&P companies trading at below average multiples  Ample supply of private equity  Drop in natural gas rig counts should provide near-term price support HeadwindsTailwinds (1) OPEC puts faith in deep cut to revive oil price 12/16/08.
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