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Signs of recovery, but costs won't fall much further

By Tom Nicholls Energy markets are entering a recovery phase that should continue into next year, says Claudio Materazzi, chairman of GE Nuovo Pignone, part of equipment and services supplier GE Oil & Gas. "I'm moderately optimistic," Materazzi told WGC News. But he added that any oil and gas firms hoping for a further big drop in costs are likely to be disappointed, because the recession has taken a large amount of capacity out of the sector. He said costs are unlikely to end up falling by much more than 10-15% from the peaks of mid-2008, when oil prices peaked at just below $150 a barrel. And with oil at $60-70 a barrel there will be a "fair amount" of upstream activity, which would be lik

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