WTI $75.78 -73c, Brent $79.68 -68c, Diff $3.90 +5c, NG $4.15 -11c

Oil price

Crude had a slightly weaker day yesterday as rumours inevitably swirled around the market place very much as expected. Also as expected, the talks between Iran and the P5+1 couldnt come to an agreement and will resume at the end of June 2015. At least that means that Iran dont have the wherewithal to significantly increase oil production until 2H 2015 at the earliest, the straws we cling to eh?

Now, as to those rumours I was talking about. The first was that in the event of any agreement to cut production at the Opec meeting, three countries would be exempt from such curbs and they are allegedly Iraq, Iran and Libya. The effect of this would be that cuts to the other member would be disproportionate as these three countries account for around 14% of Opec output. The second story doing the rounds was that Russia had offered to cut production by 300/- b/d which is around 3% of its production, by my calculations this would help an Opec cut in a small way but as they say, every little helps. I will be talking about Opec to IG Group this morning at around midday if you would like to tune in.

Thalassa Holdings

Life is proving pretty tough for Thalassa at the moment and today they have issued a profit warning saying that revenues will be ‘materially below market expectations possibly leading to a loss.’ Declining oil prices, economic uncertainty and budget reviews by clients have all led to the company saying that none of the current backlog, other than multi-client data sales, will be converted by the end of this year. To make matters worse, Thalassa has one ‘very significant’ contract in the Russian Arctic which has a material effect on revenue for this year and next and in the absence of prior written authority, cannot proceed under current sanctions. It will be a wait for Thalassa but the management is strong and determined, the technology is amongst the best in the industry and the company has a strong balance sheet with $15m of cash to weather the storm.

Sundry

Faroe has completed the sale of the 10% stake in Glenlivet to Total that it announced back in the summer, it will look forward to an exciting drilling programme next spring and summer…

Antrim Energy ‘noted’ the announcement from Sound Oil and promised to ‘carefully review and evaluate’ the details at board level. They also said that it was their current strategy to use its cash and current licence holding to buy assets or corporations to enhance shareholder value. Funny how it takes a potential bid to start the process of enhancing shareholder value, or maybe that was always in train…

And finally…

Last night in the Prem Villa thought that they were going to get three points from the Saints but in the end it was 1-1…

Tonight its back to the Champions League where the Noisy Neighbours host Bayern Munich, they dont have to win this one to go through as it happens but it would be useful to pick up three points. Chelski go to Schalke but are already through so no worries there.

And finally thoughts go out to Phil Hughes, Aussie batsman who is critically injured in a hospital in Sydney after being hit by a bouncer in a Sheffield Shield game.