WTI $29.04 -40c, Brent $32.18 -$1.18, Diff $3.14 -81c, NG $1.90 -6c

Oil price

The oil market treated the so called ‘Doha accord’ with the contempt that it deserved. I’m not saying that we didnt believe a word of it but its plainly a sheep in a wolf’s clothing. Unless you can stretch your belief that the production freeze is until the end of the year and that the most optimistic demand forecasts  are genuine then its all in the Walter Mitty department. The market thinks, quite rightly, that Iran will demand existing quotas which even if they are not achievable right now do not constitute any cutbacks, exactly the opposite. The phrase to note is ‘Provided the other major producers follow suit’, not a chance you whisper…As I suggested a while back ,countries have been producing at record levels just for this moment when they freeze from an acceptable level. Nevertheless the Venezuelan has packed his bags and is on his way to Tehran where he is to  hold talks with Iran and Iraqi representatives, I wish him the very best of luck…

With the API and EIA inventory figures delayed a day due to the Federal holiday, the markets eyes turned to the Genscape numbers which added to the gloom as they saw a build at Cushing of over 700/- barrels, tonight is expected to add a short 4m more barrels…

Savannah Petroleum

The company has announced that it has agreed a framework contract with BGP Niger SARL for seismic services for R1/R2 and R3/R4 in Niger. Good to see Knotty continues to do some operational work as the RTO, which is not scheduled to complete until April, meanders slowly on. When it can be bothered, industry lags enjoy guessing the identity of the RTO’ee and the name of Steve Lowden keeps cropping up as a quote would suit him and of course backers at Kerogen Capital…

Sundry

One of the other thing industry lags chat about is the status of the Pantheon well VOS#1 in East Texas, where a blockage has been causing modest grief. As I understand it, Jay and the team are assessing the best way to produce from this well as I mentioned in my last report on the company, so it wouldnt surprise me, that given access to similar well data, a solution can be found. Meanwhile, the last statement reminded us that the Polk County well should be onstream flowing gas and liquids before very long, showing just how quickly these wells  can be throwing off cash and making a swift return on investment.

Down at Gatwick airport the authorities are on standby as apparently there is so much oil in the area they will only need a local refinery to service the requirements of the airlines. The Gatwick gusher as it has romantically been named, has flowed oil for several hours and it wouldnt surprise me if the Venezuelan minister didnt pop by on his way home to try and persuade the owners to keep production down and not ruin his Doha accord by pumping millions of barrels a day into the world market…

And finally…

Chelski are still in it, just after surviving a bit of a mauling from PSG and returning with a precious away goal.

And Nigel Sears, father-in-law of Muzza has told the world that his collapse at the Australian Open was down to ‘a bad piece of sushi’, never heard that one before….

Ronnie O’Sullivan-legend….