WTI $96.43 -$1.06, Brent $106.04 -36c, Differential $9.61 +65c, NG $4.91 -4c
International markets continue to be in turmoil and this morning Tokyo has pushed down further and as I speak Europe follows it down. There are plenty of contributory factors, the latest excuse being the US ISM data being weak but its a big week for stats and meetings with the ECB, MPC and the non-farm payroll just to name three as well as Janet Yellen being sworn-in last night.
Brent is dicing with death around the $106 support level, traders tell me that it got to $105.40 yesterday in intra day trading but recovered to close at $106.04, phew! WTI was a bit worse but having been a better performer lately has a bit more to play with but inventory stocks will, as ever, play an important part this week. A bit of bad weather in the northern hemisphere is probably just about holding prices together although my spies think that Brent has been quite well bid and hedgies have upped their exposure recently.
Finals from BP which marginally beat lowered estimates coming in at $2.81bn for the quarter, $13.4bn for the year down 21%. The usual Bo Diddeley speak made it sound like a good year, but divestments, lower refining margins, higher depreciation and exploration write-offs combined with a Macondo charge that is now $42.7bn is hardly something to write home about.
The company has spent $6.8bn of the initial $8bn buy back but don’t forget that it plans to extend that by another $10bn when that runs out and will be buying up until 2016. On recent experience the buying back of about 7.5m shares a day is doing quite a good job holding the shares up and the dividend is also a positive feature in an otherwise unprepossessing landscape.
There isn’t much more that BG can say after last weeks profit warning, today it reported a quarterly loss of over a billion dollars in a full year profit of 3.9bn. Small solace for shareholders was the 10% increase in the divvi but its hardly a yield stock although I am still believing that £10 is a fairly good support level and that whether the board admits it itself, the assets are ‘sur le Marché’.
The Total deal announced last month whereby it gains access to UK shale assets in the Gainsborough Trough completed and companies responsible have made announcements. On the premise that arriving is less fun than travelling, the share prices of all the participants fell last night in Aus and this morning in London having in most cases rewarded shareholders for what were good deals.
I was having a conversation only last week with someone about management succession at Premier, interestingly if my memory serves me correctly, we came to the conclusion that Simon Lockett would probably move on, sooner rather than later having nearly done the deed a few months ago. It is always a smidgeon disappointing to those concerned, when upon the announcement of the departure of a senior member of management, the stock price shoots up on a red day in the market. The more pressing question for long suffering Prem holders is who will take over? This is probably not the time or the place for that discussion ( I’m not ducking it, I shall return!) but for a £1.5bn market cap company, rather over owned this is as crucial decision as these non-execs will have had to make for a very long time…
Pistols shots ring out in the barroom night
Enter Patty Valentine from the upper hall
She sees the bartender in a pool of blood
Cries out “My God they killed them all”
Here comes the story of the Hurricane…
Couldn’t resist that, but for those of us who have travelled with the Hurricane story for so long, today is indeed a long-awaited red letter day, a day that judging by the fall in the share price has been greeted by weary holders as an opportunity they thought might never happen.
Actually it might have been worse, it’s not a brilliant day for the first oily Aim IPO since Jubilant and hopefully will perform better! Original backers are probably entitled to cash in some of their investment especially if they topped up in the raises on the way. Hurricane enters the market today having had a convertible which raised £31.4m last March (holders locked in I’m told by advisors) added to by the recent raise of £18m at 43p. So the fall to 38p whilst being a touch disappointing, is not really the end of the world, in that I expect it was forecast by the house brokers who I’m sure are at this very moment inspiring those who bought at 43p to ‘top up’ at these even more attractive levels. The real price mover for Hurricane will be the well expected to spud in the 2nd quarter on the Lancaster discovery and if that comes in 38p really will be a bargain basement price. (ouch, even by my low standards!)
More work to be done on this story but I will dig as its one I rather like, my initial thoughts at seeing the resignation of Eve Howell is one of disappointment as I had already rather got to like the merged Tangiers/Jacka play. Clearly those who know, know more than I and think differently as Eve was forced out by the major Tangier shareholders presumably due to the proposed transaction. The other most interesting thing will be for the Jacka shareholders who find their stock suspended. As I said, I like these shares and want to do more digging, if you act for either please get in touch! Watch this space…
So, Jose didn’t park the bus but Pellegrino said afterwards that the best team lost, as did Moyesey at Stoke on Saturday, overall last night a good one for London clubs. On that subject the FA Cup replay between Fulham and Sheffield Utd takes place tonight, Fulham cant buy a point in the League so may just play the reserves tonight, if they hadn’t got rid of him it might have been made for Berbatov…
‘Roy’ Kinnear leaves Newcastle where he was Director of Football, I mention his title as you wouldn’t know, he hasn’t made a permanent signing since he arrived and sold their best player, just the sort of ‘Director of football’ one needs really…
Floyd Mayweather is picking his next victim, at least he is choosing his next professional fight..
And thoughts with the Thorpedo who I hear is a bit under the weather at the moment.