Oil price forecasts and security analysts: evidence from the oil industry

This study examines the relation between the U.S. Energy Information Administration (EIA) oil forecasts and analyst earnings forecasts for oil firms. Analyst forecast biases (revisions) are positively related to EIA oil forecast biases (revisions) but only for firms with greater analyst coverage. For these firms, we also document a positive association between analyst revisions and future oil prices. This association becomes insignificant after the introduction of concurrent EIA oil forecast revisions, suggesting that security analysts might not possess incremental information on future oil prices.