Nomura applied broad-based reductions to share price targets across the oil sector on Thursday morning, after downgrading its view on the European oil category from 'bullish' to 'neutral'."In spite of year-to-date underperformance, we take a more sanguine industry outlook," the broker said, listing four major reasons behind the move.These include: increasing downside risk to oil prices; falling refining profitability expects after recovery seen in second quarter while the marketing outlook is revised lower; upstream margins suffering from 'stick costs'; and negative earnings per share momentum and the risk of further downward revisions."While Big Oil is repositioning portfolios, we suspect investors are unlikely to give the group credit until a greater degree of the transition is in place or there is greater evidence that the drillbit offers meaningful upside."The broker's "best buy ideas" are: Royal Dutch Shell due to its cash generation and strong balance sheet; BG Group for its resource exposure and long-term growth; and Eni as it continues to delivery on restructuring.In contrast, the broker remains cautious on BP and Total and has downgraded its ratings for OMV and Statoil to reflect outperformance and leverage to lower oil prices.Nomura has made the following ratings/target price changes to the UK-listed stocks under its coverage:Shell - target cut from 2,700p to 2,500p, 'buy' rating kept.BP - target cut from 500p to 460p, 'neutral' rating kept.BG Group - target cut from 1,850p to 1,700p, buy rating kept.Meanwhile, Credit Suisse said today: "The correlation between oil and equity prices is at a 30-year peak (the common driver is global growth). However, we think the key going forward will be inflation expectations: these have held up in spite of the falling oil price (as investors correctly see lower oil prices = more QE). Higher inflation expectations typically means higher equity multiples (as long as inflation expectations remain below 4%)."The broker revised down its forecasts for Brent to average $104.35 in 2012, $102.5 in 2013 and $115 in 2014. MJ