WTI $94.37 +41c, Brent $107.06 -3c, Differential $12.69 -44c, NG $4.33 -6c
Still very quiet with modest moves but there are a few things going on that might effect the commodity. Firstly, the Chinese GDP data came out this morning at 7.7%, two ticks above central forecast and one above analysts consensus, the previous quarter was 7.8%. Whilst there are people who consider this a disaster I am not one of them, this rate of growth is still massive and will continue to support growth and you only have to look at domestic vehicle demand to realise that the need for oil products is only going one way.
Today is the day that Iran start implementing the deal with the big six whereby they start to curb their nuclear programme and in return start to get sanctions lifted, albeit slowly. What has amused me is that, presumably tongue in cheek, a spokesman said that it might take as long as 6 months to get back to 4m b/d! Lets think 1m b/d in six months then maybe more after that.
Its Martin Luther King day today so markets are shut including most of the oil exchanges.
As I said on Friday that wasn’t so much of a profit warning, more a gentle nudge, I’ve seen more price movement after a dry hole in French Guiana. What it does do, and a number of commentators, including myself suggested, is push the new CEO into some bigger, braver decisions regarding spending. I have said for more years than I care to remember that downstream needs much more of a knife being taken to it and that the majors aren’t always the best people to run the process, maybe this will kick-start another round of reducing overcapacity…
Today we have seen Shell pull out of Wheatstone and sell for a modest $1.135bn to KUFPEC, not what they expected when they started the process I imagine but this is just the beginning of the knife being wielded. I suspect that there are lot of partners with Shell all around the world who are about to find out that a life long partnership is not what it seems like. Not all is bad though as like KUFPEC, companies may be able to buy Shell out of projects and drilling programmes on the cheap, starting with French Guiana maybe…Come on Wessex…!
The company announced this morning that Statoil has withdrawn from the JLDA for the new licences they were applying for namely, Zapata, Falcones and Islamorada. Whilst this is hardly news to cheer from the rafters it is paid up and they might have been in with Shell. It means that the company can, with 100% of the vehicle, maybe tempt one of the many people in the ‘busy’ data room with additional exposure in the area. There are a lot of people invested in BPC who thought that something might have happened by now, possibly even some drilling perhaps, but like a lot of things in the industry the pace can sometimes be slower than you expect. For Bahamas there are two hurdles, the farm-out must happen before too long and of course the commitment well has a deadline of April 2015. I am waiting to speak to Simon but actions speak louder than words and news of an industry deal is crucial and will lead to the promised land so many shareholders keep telling me about!
The Sunday Times did a bit of a hatchet job on Rockhopper yesterday but I’m sure that after all the brickbats that the company has faced over the years that they will consider this mere bagatelle, after all most ‘followers’ never expected them to get this far. I am hoping to speak to Sam soon but I am sure that he will be able to give some background to the board changes at the company. I know Peter Dixon-Clarke pretty well and although I haven’t spoken lately both he and RKH will travel well on their appropriate paths, he is a good man and Rockhopper is a good company. The only thing that the author of the article and I share is that there has been a bit of, how you say, slippage in the Sea Lion timetable that I alluded to last week and in anybody’s book, first oil wasn’t due to be in 2019. I will come back after I have spoken to those concerned…
Very little to report in the football at the weekend with most games going as predicted, Man Who are going to have to win the Champions League to qualify for it next year though.
Muzza has just got through in Oz, after breezing through the first two sets he lost set three as if he was on autopilot, he even broke his racket into many pieces, maybe he had been expecting to be sponsored by Shell next year…
In the cricket England have been lamentable, and Captain Cook should soon be plain Mr Cook or even a spectator, surely there are some lambs to deliver somewhere? Another great win for the women’s team though, bet they aren’t frightened of Mitchell poxy Johnson and his mates…
Last night in the NFL,
The Seattle Seahawks managed to hold off a late charge from the 49ers to book their place in the Super Bowl and win the NFC Conference Title. Colin Kaepernick threw a late interception to hand their division rivals victory. Led by quarterback Russell Wilson who was aided by ‘The Beast’ Marshawn Lynch, it was clear to see why the Seahawks were the top seed in the NFC.
Seattle will face the top seeds in the AFC after the Denver Broncos eased past the New England Patriots. Peyton Manning threw for over 400 yards and two touchdowns as the Broncos won 16-26, a score that arguably flattered the Patriots… This is the quarterback’s 16th season in the NFL and will be his third Super Bowl appearance. Few would bet against him adding to his victory in 2006 with the Colts.
The Super Bowl will take place on Sunday February 2nd at the MetLife Stadium, NJ.
Extraordinary scenes in the NHL in a game between the Calgary Flames and the Vancouver Canucks as eight players are sent off after a fight broke out 2 seconds into the game. For frequent viewers of the league, it might not be entirely unsurprising.
The phrase ‘Went to a fight and a hockey game broke out’ has never been more appropriate.
And I see that David Kotler has tendered his resignation as head of oil and gas at Morgan Stanley in order to run Delta International, the personal fund of Sheikh Badr Al-Aiban, just proves that all the money in the world…