WTI $72.76 +$2.23, Brent $77.62 +$1.31, Diff -$4.86 -92c, NG $3.00 +6c

Oil price

Another good day in the oil markets as punters realise that the upside has the greater chance of success at the moment. The differential has narrowed again, having been $12 it is now less than $5 as Gasoline demand again reaches record levels (especially ahead of Independence weekend, refinery capacity is tight and accordingly the EIA reported a massive 9.89m stock draw this week. The State Department also said that wit regard to Iranian sanctions there will be no exceptions and no exemptions which will concentrate a few minds come November.

Research below is a snap shot, I will try and catch up with a number of others who have reported this week tomorrow as there have been some important announcements and I have visited several companies this week.

Tullow Oil

Trading updates all over the place and good news from Tullow who have had a good run on production declaring 90.1/- boe/d and upping guidance from 82-90 to 86-92/-. Debt is falling but given the oil price I’m a bit surprised it wasn’t more but it should accelerate. The drilling programme for the autumn looks exciting with Cormorant set to spud in Namibia in September and high profile wells in Guyana and after 3D seismic probably in Mauritania. (Guyana and Namibia of significant interest to Eco Atlantic) Tullow has hunkered down for a while but I think there is more excitement due 2H 2018.

Jersey Oil and Gas

JOG has announced that the 3D seismic survey is complete over the P.2170 licence area and certain offset acreage in good time and with no accidents. Delivery of the final data is expected late in Q1 2019 and will be integrated with the results of the Verbier appraisal well expected later this year. Should this be a success the combined information should be an important step towards strategic planning for the potential development of Verbier.

Wood Group

Trading at Wood is slightly better than expected but it needed to be after recent disappointments. Although business for the oilfield service companies is picking up it is very selective and by no means certain the E&P companies are going to just give back recent cost savings just like that. Wood gains from the AMFW savings and in some areas but there is much more to be done and the jury is still out.


As with Wood Hunting’s performance has been a bit patchy but where it differs is that it has significant exposure to the US onshore which we all know is going gangbusters at the moment. Accordingly, US onshore is very strong and with improved sentiment in US offshore and ‘localised regional improvements in Asia Pacific and Middle East markets’ they report what is a pretty good trading update.

I have always liked Hunting Titan and it is leading the way with ahead of expectation numbers and the US segment has returned to profitability. With a strong balance sheet with over $30m of cash and very careful control of costs Hunting is looking increasingly good amongst its peers.

Diversified Gas & Oil

Information coming out of DGO has been sparse and when I spoke to its IR reps last week I was told to be patient about further details of the acquisition and catching up with the company. We are now hearing that the raise is likely to be $250m at 97p which shows that even with barest of details the deal should be a good one. The Appalachian interests I suspect will be similar to other deals and add 32/- b/d of production and this time is mainly funded by debt. I like the DGO team and look forward to reporting back before long.


Here is this week’s VoxMarkets Podcast which is a bit late as I’ve been on the move a fair bit this week.

VOX Markets podcast: Echo Energy, Rose Energy, Trinity, Eco Atlantic O&G and Empyrean Energy

And finally…

In brief, last night saw the World Cup exit of Germany at the group stage, not a regular sight as they suffered a comedic loss against South Korea.

Today it’s England’s turn as they take on Belgium to see who wins the group. They will know who their next opponents will be after Japan take on Poland and Senegal play Columbia.

In the T20 v the Aussies another excellent performance by Jos Buttler and team meant that they win the one-off game and the  series 6-0.