WTI $41.93 +$1.10, Brent $44.29 +$1.19, Diff -$2.36 +9c, NG $2.83 -1c
It will be touch and go whether oil ends up on the week, as I write it is all square with both crudes down this morning after disappointing import data in China. To be fair the rally has been inspired partly by short covering and modest news such as BP restarting the Whiting refinery also the Genscape number yesterday showing a small crude draw at Cushing. Today it is Non-farm payroll day in the US with the whisper being 179/- jobs created but after the last couple of months forecasts are to be laughed at. (Cue 179/- dead on…)
Natural gas price
Natural gas often gets a mention but rarely hits a headline on its own, yesterday was such a day. Regulars know that there is an injection season and a withdrawal season and very rarely do they interrupt each other. So, yesterday the EIA reported a draw of 6 BCF in the middle of the injection season so one had to investigate what went on. The same week last year saw an injection of 38 BCF which makes it all the more odd, the answer is one of the hottest summers on record in the US has got the air-con units going flat out at the moment. Last week it was 27% hotter than the 5 year average and another interesting fact is that, also last week, there were 87 gas rigs working against 220 this time last year. Simple really but having had an oversupply of natural gas for some time now it looks like a combination of falling investment and the weather are bringing the commodity back into equilibrium, those bulls may well be on the right track…
Premier has released the result of the Bagpuss well in the Outer Moray Firth. With 41′ of hydrocarbon sands and a 68′ column the results are in line with pre-drill estimates, the oil is heavy with 25-35% porosity. Work now continues to determine the commerciality of the discovery and whether the other pre-drill estimate of 2bn barrels is also accurate. The difficulty is that under current circumstances a discovery like this is probably not what the doctor ordered, with their current finances I suspect that if it doesnt fly, it dies… I look forward to a chat with Tony Durrant, probably after the results on 18th of this month.
Apologies for the technical faults on the SDX links this week and thanks to Mariette from the wonderful web designers Jackson Bone for sorting it out in my absence yesterday. I have been as busy as a drug tester in Rio this week…
And it will be good to welcome John Ogden and his wonderful wife Yvonne to London this weekend. John runs Wood Roberts LLC with his partner John Martinson, they are a specialist corporate finance for energy boutique based in Houston.
After four years of waiting and uncertainty about who might turn up, the Olympic games starts tonight in Rio. For UK viewers it will be all night vigils as the time difference (-4hrs) means that the 7-11 evening peak slot is 11-3am for us. Super Saturday becomes super Sunday but I’m sure we will manage somehow, the opening ceremony starts at midnight tonight.
The football season is well and truly back, the happy Hammers had their first fixture at the London Park last night and won 3-0 against NK Domzale putting them into the next round, not so much luck for Aberdeen who rattled every tree before going out last night…
The Baggies have been sold to a Chinese consortium led by Mr Guochuan Lai whom I’m sure will be a familiar sight on the terraces at The Hawthorns during the season….
The FA Cup starts this weekend as well and at the other end of the scale it is the totally useless Community Shield, this year between the Foxes and the Red Devils.
The Championship season also starts this weekend and the relegated clubs might be in for quite a shock, the Magpies travel to Fulham tonight for their first game.
And England cricket took another few paces backwards yesterday, howlers in the field, overthrows, dropped catches and arguing with the umpire meant that Pakistan are in with a good chance of building a substantial first innings lead today.