WTI $106.36 -54c, Brent $113.45 +51c, Diff $7.09 +77c, NG $4.71 n/c
Still plenty of room for upside as the latest IEA report casts doubts on Iraq’s chances to increase production with or without the current problems. As for Iraq, all the companies operating there are still reporting that operations are ‘unaffected’ by the activities in the country although I am hearing that they are all making contingency plans to withdraw workers as one might expect. I have been hearing news that a major refinery has been shut down with the loss of 300/- b/d of product which will have to be imported.
It’s a good time I suppose to be having the big conference in London at which key speakers have included Dr Ashti Hawrani the KRG Oil Minister. Yesterday he told the conference that the KRG were exporting 125/-b/d through the pipeline to Turkey as well as two tankers that have left Ceyhan headed for international markets with two more loading at present. He expects exports to reach 200/- to 250/-b/d during July and 400/-b/d day by the year end. Interestingly I have a conference call with key executives of Genel this morning so should be able to flesh that out tomorrow.
With the FOMC meeting happening and also the BOE and ECB having crucial committee meetings there will be no shortage of hot air later but so far Mark Carney is proving to be the most hawkish. Last night the API inventory stats flummoxed the scribblers as they reported a draw of 5.7m barrels of crude against forecasts of 650/- barrels, WTI had been down and started to motor which is has continued this morning, overturning the widening differential to Brent. My traders tell me that Brent itself had a small rally towards the close but on insignificant volumes.
Sundry bits and pieces
There are no major announcements out this morning but a few small items to mention. Circle Oil has had a successful gas discovery on the SAH-W1 well onshore Morocco, the Sibou permit with its field adding more positive news. I was surprised when I saw the Chevron activity in Chad the other day, only so as I thought that Glencore would be involved somehow owing to its dominance in the country. It turns out that they have been retained by the Chad Government on the financing of the deal, phew!
Sound Oil has announced the completion of the Continental Investment Partners deal whereby they have taken a significant interest in the company, at the time the entry price was over 70% above the stock price, now it is below it as investors start to appreciate the company a bit more.
I should have mentioned Range Resources yesterday but as you know I was heading out early (on a course…) and hadn’t got all the bits together in time. I have written on the company so many times recently it is almost the Range blog but yesterday they had not one but two more pieces of good news. Firstly the Trinidad Government has announce further capital incentives which should increase NAV’s and encourage domestic production, very good news in the company’s core asset. Secondly the news from Guatemala released by Citation yesterday confirmed that the Atzam#5 well has ‘significant commercial potential after further testing by Schlumberger. All good news for Range who I am seeing next week for a full update, it will be action packed!
Finally those who are interested may want to look at some videos I recorded with Interactive Investors a few days ago. They are all now available on the interview section of the website ( www.malcysblog.com) and the areas and companies I cover include; Caza, Range, Xcite, Gulf Keystone, Sound and Rockhopper in Italy plus a round-up on all the fraccing news including IGas and Egdon Resources/Alkane.
I thought that Brazil looked very ordinary last night and full marks to the ref who didn’t fall for the blatant cheating late in the game as they looked for a pen. Likely of course they will qualify but not firing on all cylinders by any means. Russia also drew, with South Korea whilst Belgium came from behind to beat Algeria with that useless Fellaini finally scoring a goal…Tonight sees Cambodia v Croatia and in the very interesting group Spain must beat Chile or trouble looms and the Dutch should see off the Aussies.
At Royal Ascot it all went well, Toronado won as did the good thing that is Kingman and Sole Power brought home the bacon thank goodness…Frankie had a winner ahead of today’s ride on Treve..
United Airlines have managed to lose Rory McIlroy’s bags en route to the Irish Open which starts tomorrow, no sign yet I hear….
And the Premiership fixtures are out this morning and day one and there are no surprises, newcomers Burnley host Chelsea and the pick of the rest is probably West Ham at home to arch rivals Spurs..