WTI $106.43 +48c, Brent $108.68 -6c, B/WTI Diff $2.25 -54c, Natural Gas $3.67 +2c

Good morning

The market has been a bit puzzled by inventories in the last week or two and I have been closely watching the retail gasoline prices in the USA. Up until this week there has been no sign of a pick-up, either from the alleged economy recovery, which must be happening as tapering is being considered(sic) or from the normal demands of the driving season, now well under way. Well, last night’s figures have started to show a rise in gasoline and diesel prices, across the country gasoline rose 14.7 cents last week to $3.63 per gallon whilst the diesel hike was smaller at 3.9 cents to $3.87 a gallon. Please feel free to draw your own conclusions but that’s a decent rise in the gasoline price.

Oil Price

It’s all about the inventories-stupid! After two weeks where we saw a total of over 20m barrels drawn down the API stats tonight and the EIA tomorrow will give us a guide as to whether the draw continues. There is no particular reason to do so which is why I guess the analysts’ consensus figure is -2m bbls but given their ability to predict anything could happen…..

On the basis that one should run the positive sentiment then the market will continue to test the higher levels, $109 and $110.81 for Brent and $107 and $109.19 for WTI but with ever increasing hedge fund and investor long positions in a fundamentally well supplied market it will likely end in tears.

WTI Crude oil 1 Year chart

WTI Crude oil 1 Year chart


It looks like Argentina is feeling the pinch as they struggle to increase oil output and struggling with product imports recently. So they are announcing a series of incentives to encourage companies with 41bn a year to invest over the next five years, Repsol perhaps?……………


RWE has stated the b obvious by saying that the Liberal Democrats green policies will push up bills, forecast to be up 19% by the end of the decade. Greg Barker, minister for energy and climate change has blamed rising global gas prices, not green policies that were pushing up bills, Barking more like…..


Premier has announced this morning that it has sold 100% of its interest in the subsidiary Premier Oil Vietnam South BV (POVS) which holds a 30% operated interest in block 07/03 offshore Vietnam. The block contains the Ca Rong Do oil and gas discovery and the Ca Duc exploration prospect and Premier could receive as much as $100m for the asset subject to discoveries and development. The chart shows what a roller-coaster ride it has been lately in Premier, having climbed aboard the shares last autumn we haven’t got off the bucking bronco, as it were, and continue to think that the management are doing the right things, also they are finding some hydrocarbons which helps. Stick with it for now

Premier Oil 1 Year chart

Premier Oil 1 Year chart

Amerisur Resources

An update from Amerisur on Platanillo this morning, snuck in between test matches conveniently. Platanillo-12 continues to perform well and has been completed for production at approximately 1,450 b/d and the guidance for the Platanillo field is 8,500 b/d all in.

With surface work adding 30,000 barrels of additional storage ready by the end of August and a number of options being explored for oil sales production and sales should continue to grow. Having peaked at 58p the shares lost ground and are probably now more realistically priced at the 47p level.

Amerisur Resources 1 Year chart

Amerisur Resources 1 Year chart

And finally…

England’s women footballers scored an equaliser in injury time against Russia yesterday to keep them with the faintest hope of qualification for the next stage. They will now have to beat France and hope other results go their way.

And Manchester United have made an audacious bid for Cesc Fabregas of £25m but below the Barcelona valuation. It is understood that Arsenal are also watching the situation closely albeit trying to buy Suarez themselves.

And ‘fabulous’ Fabrice Tourre arrived in court in New York yesterday where the former G Sachs bond trader was facing a civil fraud case brought by the SEC. But bringing just one bloke to court for such major misdemeanours seems a bit odd, was he doing it all on his own, I mean, I know he was good at his job but…………….