WTI $81.00 -1c, Brent $85.83 -30c, Diff $4.83 -29c, NG $3.56 -6c

Oil price

Little change yesterday, except maybe that the differential, which had got down to as low as $1.77 and bounced to over $5 crept back to $4.83. The physical market is directionless, traders telling me that buyers remain off the market trading only what they need, waiting for something to happen.

Will that thing be the Fed we ask? With the meeting starting today, tomorrows announcement will likely end QE but keep interest rates down but bear in mind that a 25% fall in the oil price, which is what we have had in less than two quarters is like having a QE delivery but from the oil producers, they are getting it in reverse. Last week I mentioned retail gasoline prices in the US, this weeks figures show another big fall with pump prices down another 6.4 cents on the week to $3.06 a gallon, not long before the Shermans are cruising along at sub three bucks gas…

BP

3Q figs this week and started today by BP, it is the calm before the storm really as the crude price peaked at just over $115 right at the end of the previous quarter and was falling sharply throughout the period. BP has just beaten the whisper of 15 cents coming in at 16.51 and the replacement cost profit was $3bn but there was not surprisingly a big stock gain in there, that will surely be reversed next time. The good news is that cash flow is up at $9.4bn giving the company confidence to raise the dividend, surely an unnecessarily brave move whilst fighting fires in both Russia and America. Talking of Russia, the  Rosneft contribution was $110m, down from $808m with the falling Rouble, Urals oil price weakness and the duty tax lag effect all blamed.

Overall the numbers are fine and with the divvi up and the shares a pound a share off the high they can hardly be deemed to be expensive down here. The reason for the significant discount against most industry peers remains one of risk, BP is still in hot water in the USA and very cold water in Russia and until either of those changes a re-rating is unlikely, however one move from Exxon say, could change that in the blink of an eye…

BG

With a new CEO not starting until next year BG results are going to be plain vanilla, lets not make any big calls, make sure we hit the guidance and dont do anything silly. Today’s numbers are just that, EPS at 22.3c crept past the whisper and production, down 2% was in line with guidance. Here the Egypt number was down but remedial action is working but the good news was that Brazil was up and a milestone has been passed, 100/- b/d in October. This oil helped the price mix but elsewhere realisations fell and costs were higher so something to tinker with there. Guidance again was hit and is unchanged in LNG with profits down 4% at $576m but QCLNG is still on track for first LNG in December. So, all going according to plan and although falling prices will hit them like everyone else there will be no strategic changes until next spring at the very earliest.

Harvey Nash

Harvey Nash are hosting their legendary Oil & Gas Board Dinner tonight where the cream of the industry meet and also raise money for Raft, a brilliant charity. This year’s guest speaker is Sam Laidlaw who I am sure has been on this card before and I am sure he will have much to say about the excitement of running a utilities business…

And finally…

One game in the Prem last night as the Super Hoops levered themselves off the bottom of the table beating a dreadful looking Villa side 2-0, relief for ‘Arry who is getting it from all sides. In the 1st round FA Cup draw where the 1st and 2nd Division sides come in there are a few choice ties and the real minnows can just start to see the bigger fish. Accordingly i have picked out the visit of Aldershot to Pompey as an almost local derby and Richard Welfare at Hogan Lovells will be relishing Gillingham vs Bristol City…

Tonight in the Clueless Cup Chelski travel to Shrewsbury and Fulham host Derby which might actually be tight…

And having seen the end of the Caterham team at the weekend, Formula 1 lost Marussia yesterday, very sad all things being considered.