1. There is a projected 12% increase in production from 2011. 2012 is projected to see 7.5M production number, from 6.7M in 2011.
2. SU needs crude to stay above 80 to be viable, but based on their 2012 revenue projections they need WTI and Brent to stay above 89 to meet revenue expectations. Right now, WTIC and Brent are well above 89.
The negatives do not seem to be that bad, when compared to the above.
1. NatGas AECO price is currently 2.73, already below their expectations of 4.74.
2. In 20011 oil prices were higher, thanks to geopolitical factors, and the year-over-year comparisons may not look so good, which merits a reduced multiple.
Barring a complete breakdown of Crude, SU will retest the upper band of resistance on the daily or approach the weekly 150SMA. Sustained oil prices should allow SU to trade north of 34-35.