Latest Postings20/6 China - Strategic Oil Reserves - Old News Again Tuesday saw news that China and Saudi Arabia are in the makings of a deal concerning Chinas SPRīs... China set up the SPR project in 2003 and has said every year since then that the reserve is about to be filled, - next year. The SPRīs are set to be in, Daishan of Zhoushan City, Zhejiang Province, Xingang of Dalian City in northeast China's Liaoning Province and Huangdao of Qingdao City in east China's Shandong Province. The total of the Chinese reserves would about 100 mmbls when completed in this the SPR would be good for about 20 to 25 days of demand. This in contrast to oil reserves of the United States, Japan and Germany which can meet demand for 158, 161 and 127 days, respectively. 20/6 Oil - Statistics from the USA DOE - API - 21/6 14.30 GMT I expect, Crude + 1.2 mmbls Gasoline + 2.5 mmbls Distillates + 2.0 mmbls Natural Gas + 70 bcf Crude Import 10.9 mmbopd Gasoline Imports 1.6 mmbopd Refineries 93.5% Gasoline Demand 9.4 mmbopd Distillate Demand 4.0 mmbopd Total Petroleum Inventories + 6.0 mmbls 16/6 Oil - The Uptick Continous Another seemingly good day for Oil. The strategy is however to close all trading positions before the bell. If this keeps going on Monday there will always be time to get back in. 16/6 Lundin Petroleum LUPE:SAX - Valkyries Petroleum VPC:TSX As I have said before - This is a done deal! Share holders in both companies will be more than satisified with the end result. A clarification is due I think. Increasingly countries with natural resources are taking control of the same and only want to deal with larger companies when it comes to exploration and production. Minows like VPC can make a huge discovery, yet there they are a small company with a large asset and a host country that is looking for scale. The whole point with the inclusion of Valkyires into Lundin Petroleum is scale. In this I see LUPE continuing to build and diversifying going forward. I have long held the belife that Tanganyika Oil for instance would fit very well under the parent company umbrella, a view I know is not shared by all yet I see it as an unavoidable end result.. Itīs very simple itīs all about scale. It is also the Lundin Family strategy ie to build a large Independet Natural Resource Company. Like it or leave it... 14/6 Tanganyika Oil - TYK:TSX - TYKS:NMG The Icelandic bank Straumur-Burdaras Investment Bank has obtained what could effectivly be called a corner position in the company after acquiring 10.06% of the current outstanding shares. "Straumur-Burdaras acquired the securities of Tanganyika for investment purposes only and not for the purpose of influencing control or direction over Tanganyika. Straumur-Burdaras and its joint actors will, however, review its holdings in Tanganyika from time to time and may increase or decrease its position as future circumstances dictate." 14/6 Oil - Thursday Buy I would buy Oil Thursday, stocks I belive will do well in early trade. Why? Well the US stats were bearish yet other things concern like Hurricanes, an uptick however small in Crude and well this is the weird and wacky world of commodities.. Seriously check my favorite cash on the barrel head tracker,
27/6 Lundin Petroleum LUPE:SAX With "all" things considered this oiler getīs a Buy rating from this site. The target is still 150 SEK. A mighty haul northwards it might be from the 80īs SEK, yet I do mean "All" things considered. 27/6 Iraq Iraq's daily oil production has reached 2.5 mmbopd, the highest since the United States removed the Saddam Hussein regime from power three years ago. Iraq also expects daily oil production to reach 2.6 mmbopd to 2.7 mmbopd by the end of 2006, rising to about 4 mmbopd by 2010, and 6 mmbopd by 2012. In this 6 mmbls have been sold during the last weeks for export over the northen terminals.. 27/6 Site Updates The lack of updates since 21/6 is due to a communication problem... I apologise! 21/6 Oil - Statistics from the USA DOE - API 14.30 GMT Crude + 1.4 mmbls (API - 3.7 mmbls) Gasoline + 0.3 mmbls (API - 1.9 mmbls) Distillates + 1.9 mmbls (API + 1.9 mmbls) Natural Gas + 79 bcf Crude Import 11.0 mmbopd Gasoline Imports 1.1 mmbopd Refineries 93.3% Gasoline Demand 9.4 mmbopd Distillate Demand 4.1 mmbopd Total Petroleum Inventories + 7.8 mmbls US Crude inventories are at the highest level since the week ending May 29, 1998... 21/6 Oil - Wednesday Hold Off I would hold off on Oil Today.. Ample US stocks, Iran is talking and traders are bringing up the Chinese SPRīs!? Get real guys this is old hat.20/6 Valkyries Petroleum VPC:TSX - Lagansky Block The Degolyer & MacNaughton study from 31 Dec, 2005...
Close all trading positions before the bell or earlier as we are in a volatile downward trend market!
Take the percentage uptick and then that is that...
14/6 Oil - Statistics from the USA DOE - API - 14.30 GMT
Crude - 0.9 mmbls (API + 3.3 mmbls)
Gasoline + 2.8 mmbls (API + 2.9 mmbls)
Distillates + 2.1 mmbls (API + 0.2 mmbls)
Natural Gas + 77 bcf
Crude Import 10.5 mmbopd
Gasoline Imports 1.4 mmbopd
Refineries 92.7% + 1.7%
Gasoline Demand 9.4 mmbopd
Distillate Demand 4.0 mmbopd
Total Petroleum Inventories + 6.7 mmbls
Gasoline production 9.2 mmbpd second highest ever. Refineries did surprise to the upside. Crude storage was
below expected. Huge numbers difference between API and DOE for Crude and Distillates... Gasoline storage
is still 1.2% below last year, yet that is not entirely true as the switch over to Ethanol based fuel is
making the numbers come in lower than they really are. Also note that Gasoline deliveries dropped 3.3%
in May with Diesel fuels up by 1.2% - all part of the conversion to RBOB and CARBOB Gasoline.
Natural Gas supplies are 451 bcf above their level at the same time a year ago and 659 bcf above the 5-year average.
In summation the total amount of Oil and products in the USA increased again ie the US is well supplied
with Oil...
On the whole a bearish report for the Oil complex. Natural gas however is set to pick up with warmer, much
warmer weather on the way. Up 7% today alone...
14/6 Canada - Western Oil Sands Inc WTO:TSX
CAPP Investment Symposium, Calgary, Alberta, 9:30 am MT.
14/6 USA - Statistics - Tricky Day for Oil
Expected inflation numbers,
Consumer price index + 0.4%
CPI core + 0.2%
This coupled with the DOE/API stats makes this a double "witching day" for the contracts and ultimately for
oil stocks.
14/6 Saudi Arabia - Iran - Oil Output
Saudi Arabia produced 9 mmbopd of crude oil in May due to weak demand. April output averaged 9.1 mmbopd,
its lowest level since January 2005, May was then even lower. Iran for itīs part produced 3.85 mmbopd and it
has 16 mmbls in storage in Oil Tankers, and it is running out of storage space....
If demand continous to lag Iran will be shutting down oil fields...
Globally "commercial storage" of oil is at a premium with very little spare capacity. This at a time when
about 2 to 4 mmbpd of Refining Capacity is off-line due to maintenance or work-overs. Note that IEA monitored
storage levels come in at a 20 year high at more than 1 Billion barrels... The world is well supplied with Oil.
Saudi Arabia has cut exports to Asia by over half a million barrels a day since March to match lower
demand from refiners during their springtime overhauls.
Production from the world's biggest exporter sank to 9.05 mmbopd in May, its lowest level this year,
putting it on course to pump just over 9m in the second quarter - some 400,000 bpd below average rates
for the previous three months.
It is unclear whether demand from Asian refiners will rebound significantly during July and August
because of meagre summer gasoline demand in Japan, the world's third biggest oil consumer.
Saudi Arabia has long-term contracts to export just under 7 mmbopd of crude worldwide, with Asia accounting
for nearly half that volume. The total fluctuates according to seasonal demand and Opec output policy.
That has been the case during the second quarter with Saudi Arabia shipping 220,000 bpd less crude to
Asia in May than April. Exports in April were already 350,000 bpd less than March.
Buyers in the west took 180,000 bpd more Saudi crude in May than April, compensating in
part for the fall in the flow to Asia. The flow to western buyers in April was 150,000 bpd less than March.
The export cutback is not unique to Saudi Arabia, the leading Opec producer.
Iran, Opec's second biggest producer, curbed exports in the second quarter by
about 175,000 bpd due to refinery maintenance,
13/6 IEA - Oil Market Report
IEA: World, OPEC oil supplies rise
International Energy Agency says demand for oil remains firm even though high prices are weighing on consumption.
World oil supplies rose by 445,000 barrels per day in May to 85.0 million barrels, with OPEC pumping
half the increase, but demand remains firmly steady even though high prices are weighing on consumption, the
IEA estimated on Tuesday.
The International Energy Agency drew a broad picture in its monthly report of strongly growing demand for oil
products in developing countries in contrast to flat or declining demand in advanced industrialised countries
in the OECD.
Real spare production capacity by the Organisation of Petroleum Exporting Countries remained below 2.0 million
barrels per day as security problems and pipeline "outages" affected 800,000 barrels per day of output by Iraq
and Nigeria, the IEA said.
World demand growth for oil products this year was "broadly unchanged" at 1.24 million barrels per day.
This reflected a marginal downward revision from 1.25 million barrels per day.
The agency commented in its monthly report: "Recent strength in China and the US is partly offset by weakness
in OECD Europe and Asia, but still results in a 160,000 barrels-per-day upward revision to second-quarter demand growth.
"A booming global economy remains supportive, but high prices are weighing on consumption."
Demand from developing countries outside the OECD "clearly dominates the picture", the IEA said.
Although demand from these countries accounted for only 41.0 percent of world demand,
it represented nearly 85.0 percent of global demand growth in 2005-2006. Apparent demand in China had surged
unexpectedly by 9.6 percent in April.
Meanwhile demand from advanced industrialised countries was expected to have declined in the second quarter
of this year. Of the world increase of 445,000 barrels a day of oil supply in May, supplies from OPEC
accounted for an increase of 215,000 barrels per day from the April figure to 29.8 million barrels per day,
the IEA estimated. But "effective OPEC spare capacity remains below 2.0 million barrels per day".
The IEA revised upwards its estimate of overall demand for oil and stock from OPEC by 0.3 million barrels per day
to 28.43 million barrels in the second quarter of 2006, rising to 29.5 million barrels per day by the end of the year.
The IEA is the energy market monitoring agency of the Organisation for Economic Cooperation and Development.
It said that OECD stocks of crude oil in May had risen to the highest point for 20 years, although this
reflected the effect of seasonal maintenance on facilities in reducing the amount of oil that was drawn
through refineries.
Overall in April, total OECD stocks of oil cover in relation to demand was steady at 54 days "in view of
seasonally rising crude and product demand".
Stocks held by industry in the OECD area of 30 countries had risen by 17.0 million barrels from the March
figure and by 58 million barrels from the figure in April 205 to 2,631 million barrels.
In a breakdown of demand trends, the IEA said that demand from the OECD area was expected to show a decline
of 50,000 barrels per day on a 12-month basis in the second quarter. "In spite of recent resilience in US demand,
consumption growth remains weak in other major economies."
This would be the third quarterly decline in a row of demand from the OECD area from figures 12 months earlier.
But in the third and fourth quarters, this calculation of demand would grow because the baseline 12 months ago had
been depressed by hurricane disruption.
The agency revised upwards its estimate of demand in the United States in the second quarter
by 170,000 barrels per day but "in all, projected US demand growth remains broadly unchanged at 0.9 percent
(in 2006)." The report concluded that Chinese apparent demand of refinery production plus net imports of products
"grew by an unexpectedly robust 9.6 percent year-on-year in April.
"Gasoline demand was very strong, surging by 19.7 percent which is in line with strong vehicle sales.
"On May 24 the government raised the administered price of gasoline and diesel by a reported 9.6 percent
and 11.1 percent respectively. This should help reduce the pressure on domestic refiners who have suffered
substantial losses under artificially low prices," the IEA commented.
13/6 USA - ETF - United States Oil Fund USO
Close of day.
13/6 The Commodity Correction - Stock Market Correction
One instigates the other. Stock markets have looked at the commodities and seen the price just go up
so thingīs must be zooming along on the planet. Well yes and no. When the dust settles and the hype is laid
to rest the fact is that 2006 is very much like 2005 in most respects. The problem for the market as a whole
is that a lot of newcomers to the commodity sector have gone in big time and rather late in the game. They are
now feeling the weight of their youthful exuberance and are getting the hell out of Dodge. This then becomes
a bigger problem due to the fact that these late bloomers are BIG, we are talking pension funds and alike.
Hence the impact of the sell-off.
So what to do? Well bide your time and look at the bigger picture. This correction will be forgotten as soon
as itīs over - markets never learn. Fundamentals!! Donīt buy the hype! And remember the world has not gone off
commodities only the ridicioulus price it has had to pay for them of late. Fundamentals!!! Barrels actually
produced, ounces harvested from source rock etc..
This then the short term perspective. Longer term I am of a mind with Lord Brown of BP as to the Oil Price
going forward which can be extracted from my earlier writings...
13/6 Oil - Statistics from the USA DOE - API - 14/6 14.30 GMT
I expect,
Crude + 1.5 mmbls
Gasoline + 1.5 mmbls
Distillates + 2.5 mmbls
Natural Gas + 90 bcf
Crude Import 11.2 mmbopd
Gasoline Imports 1.7 mmbopd
Refineries 91.8%
Gasoline Demand 9.3 mmbopd
Distillate Demand 4.1 mmbopd
Total Petroleum Inventories + 6.0 mmbls
Build across the board again. We could also see a record Gasoline Production number, last weekīs was
9.14 mmbpd - 9.22 mmbpd is the ATH from July 2005.. Refiners could surprise to the upside.
13/6 Lundin Petroleum LUPE:SAX - Indonesia - Lematang
LUPE increases itīs share in the 125 Bscf Lematang operation by 10% in acquiring Sericas share.
Now thatīs a "deal".. Look for more...
13/6 The Commodity Correction Part Deux
As I have stated before, when commodities correct itīs never pretty. And it ainīt..
13/6 The IEA - Demand
IEAīs oil-demand growth forecast for 2006, a growth of 1.24 mmopd versus an earlier forecast of 1.25 mmbopd. So
less decline than expected...
12/6 Iraq - DNO - DNO:NO
I told you 2 months ago this was big... 100 mmbls plus.
*8/4 Iraq - DNO
The Norwegian oil company has hit it big in Kurdistan.. *G*
12/6 BP - Lord Brown
BP's Lord Browne sees $40 oil as medium-term average
LORD Browne, the chief executive of oil heavyweight BP, expects crude prices to fall from current
near-record levels as more supplies are discovered.
Speaking in an interview with German magazine Der Spiegel, he said there was unlikely to be any dip
in prices in the short term, but reckoned prices will probably settle at an average of about $40 a
barrel in the medium term, before falling lower.
Oil prices have surged this year amid fears about supply and global instability, pushed a barrel's
price to more than $75 in April, amplifying concerns that increased raw material costs would
seriously impede global growth.
"We cannot really count on oil prices easing very much in the near future," Browne told Der Spiegel
in an interview due to be published today. "But is very likely that oil prices will range in the
medium term around an average of $40, and in the long run it could even be $25 to $30."
Browne said that companies were finding large oil deposits in the Caspian Sea, while there was good
production potential in countries such as Russia and regions including western Africa. He also said
that improved efficiency would help boost crude extraction and added that, in the future, consumers
would have a large role to play in deciding the success of new technologies.
12/6 USA - The Fed
Ben Bernanke is set to speak today and all ears will be listening for the pitter-patter
of interest rate feet. 13/6 seeīs PPI and CPI data...
12/6 The IEA - Demand
Tuesday the IEA is due to lay itīs monthly demand increase forecast and last month saw a drop from 1.47 mmbopd to
1.25 mmbopd. I expect that we will something in the region of 1.2 mmbopd as a number from the organisation. Going
forward I see demand more or less even with last years level.
9/6 Iraq - Oil Crisis
Iraqi Prime Minister Nouri Maliki's hurried visit to Basra at the end of May following increasing violence
indicated mounting concern that the country's fragile oil exports could be about suffer even greater disruption.
Basra is the country's second largest city and only access to the sea. Given the ongoing sabotage to Iraq's
northern oil pipelines the city's port is the outlet for most of the country's crude production. If exports
are curtailed it will be catastrophic for the economy Iraq is producing less oil than before the US-led
coalition's 2003 invasion which also means added pressure on other Gulf producers to maintain and increase
their production levels to meet a continuing and robust international demand for oil.
After the invasion it was hoped that Iraq production could be raised to 3.5 mmbpd (the peak level
it achieved in 1990) by 2006 with further hikes to 6 mmbpb. It is almost certain that if anything
approaching this estimate had been reached international oil prices would be considerably less that the
$70 a barrel price level prevailing. But infrastructure has been eroded and denuded of spare parts and
technology because of 10 years of UN sanctions. Long awaited investment programmes are needed fast.
By November 2005, production had collapsed to 1.2 mmbpd and only recovered to 1.6 mmbpd
by year end some 10% down on 2004.
Sabotage attacks are only one part of the problem. Iraq spent up to $5 billion in 2005 on fuel from
abroad with perhaps as much as 30% of the same fuel being smuggled out of the country again
because of the price differentials compared with countries such as Turkey and Syria.
Petrol costs around $0.65 a gallon at government subsidised rates but sells at three to four times
this on the black market during times of supply shortages. The same situation exists for heating and
cooking fuels such as gas, paraffin and diesel. About one third is seized by insurgents and gangs.
Documentation is routinely falsified to disguise losses. Since the price of fuel is subsidised by
the government there is a double loss to the economy and a temptation for traders to participate in
the black market that has developed. Fishermen are reported to sell their quotas of diesel to smugglers
rather than bother to go to sea. The IMF has called for a fivefold increase in Iraq's fuel prices before
it will consider writing of the country's debts. But so many hands are involved in the murky business
that will be difficult for any Iraqi government to combat the corruption even if it finds the will to do so.
Things could be so different. Iraq contains 12% of global oil reserves. According to some
estimates the real figure could even be double this at about 25%. The potential is clearly vast.
Less than 3,000 wells have ever been drilled with most of the country still not prospected. Results of eventual
peace and reconciliation could be bountiful if the chance is taken.
9/6 Lundin Petroleum LUPE:SAX
Look for more "deals" to materialise going forward in the not too distant future...
9/6 Oil - Friday Buy
I would buy Oil Friday, stocks and United States Oil Fund USO.
Nordic Oil Stocks have globally taken the largest beating to the downside and as such are the gang to
bet on for the hike up.. Short or long is all dependent on your - Horizon.
I would however close all trading positions before the bell...
7/6 USA - ETF - United States Oil Fund USO
Look for the fall just after 1 pm...
7/6 Oil - Statistics from the USA DOE - API - 14.30 GMT
Crude + 1.1 mmbls (API + 0.3 mmbls)
Gasoline + 1.0 mmbls (API + 2.4 mmbls)
Distillates + 1.8 mmbls (API + 4.7 mmbls)
Natural Gas + 77 bcf
Crude Import 10.9 mmbopd
Gasoline Imports 1.4 mmbopd
Refineries 91.0% - 0.4%
Gasoline Demand 9.3 mmbopd
Distillate Demand 4.1 mmbopd
Total Petroleum Inventories + 6.3 mmbls
SPR 688.6 mmbls +-%
Total Petroleum Inventories at 1.718.3 mmbls are now at the second highest level all time.
Only August 2005 has seen a higher total. So another week where the world is well supplied with oil. A further
build in Natural Gas storage..
7/6 Oil - Statistics from the USA DOE - API - 14.30 GMT
I expect,
Crude + 1.3 mmbls
Gasoline + 2.0 mmbls
Distillates + 1.5 mmbls
Crude Import 11.0 mmbopd
Refineries 92.5%
Gasoline Demand 9.4 mmbopd
Distillate Demand 4.1 mmbop
Natural Gas + 60 billion cubic feet
Total Petroleum Inventories + 8.0 mmbls
Total Motor Gasoline Imports 1.8 mmbopd
This week includes the Memorial Day numbers which will give an indication as to where Gasoline Demand/Supply is
going at the moment. One to watch going forward is the fact that nine months after hurricanes Katrina and
Rita moved through, 21% of the Gulf's Oil production and 13% of Natural Gas production still remain offline.
Hence the import numbers...
2/6 - 7/6 Lack of Site Updates
Due to server upgrades.
2/6 Beach Petroleum - BPT:ASX
Sellicks-2 has drilled 140 metres in a deviated hole to reach a total depth of 2147m
measured depth or 2135m true vertical depth (TVD). DST- 1A (1984 2007m), which was reported last week, flowed oil
to surface at a final rate of 2685 barrels/day accompanied by water at 450 barrels/day and is a new-pool oil discovery in
the Poolowanna Formation.
Well then... *g*
2/6 USA - ETF - United States Oil Fund USO 1/6
Something interesting happens just after lunch every day.. One oīclock.
2/6 OPEC
The organisation is caught up in a pretty tangle. It knows the world is well supplied with oil and demand is
not going gangbusters yet it is brisk. They agree to leave the quotas as they are because to cut would mean
$80 plus in a market where such a price is just too much. Meanwhile everybody with an oil well are pumping
as much as they can so the storage levels world wide are growing, note in this that the US is the only
consumer of oil that publishes statistics. The EU as well "THE EU" is as I have pointed out the worlds largest
single importer of oil..
Worlds largest importers of Oil (percentage of total):
EU 30%
North America 25%
Asia 15%
Japan 12%
China 8%
Korea 7%
Other 3%
Where are the stats from the Super State?
OPEC is out on the brink because if the US statistics continue showing further builds in
storage as they will then we could be in for a mighty fall in the contracts. Yesterdays numbers
from the US were bearish and only Iran and the OPEC meeting could counterweigh. OPEC clearly has a problem
on itīs hands.
1/6 Oil - Statistics from the USA DOE - API - 14.30 GMT
Crude + 1.6 mmbls (API + 1.7 mmbls)
Gasoline + 0.8 mmbls (API - 1.1 mmbls)
Distillates + 1.8 mmbls (API - 0.4 mmbls)
Crude Import 10.8 mmbopd
Refineries 91.4% + 1.7%
Gasoline Demand 9.3 mmbopd
Distillate Demand 4.1 mmbop
Natural Gas + 80 billion cubic feet
Total Petroleum Inventories + 8.1 mmbls
Total Motor Gasoline Imports 1.6 mmbopd
SPR 688.6 mmbls +- 0.0 mmbls
Imports are up, Refinery runs are up and the Total amount of Inventories is up + 8.1 mmbls... Natural Gas
storage is close to 50% above last year and the summer is going to have to be mighty hot to deplete that
amount. Gasoline deamand only ticked up 0.1% and itīs June... Yet demand has increased on a year to year basis
by 0.9% so the question is - is this increase enough? Well next weekīs statistics will be the market maker
as the Memorial Day weekend numbers are included, the first of the big spring/summer holidays.
Gasoline storage is 2.7% below last year - still. The offset is the uptick in the Refinery numbers and the Gasoline
Imports again in the top part of the scale, I thought they would be higher yet there you are. Refinery and Crude
Import numbers were all above pre Katrina levels and all Gulf Refineries should be back at full pace the coming
weeks. I have a feeling that Gasoline numbers will pick up rather quickly from here...
Again look for next weeks stats to set the trend.
1/6 Lundin Petroleum LUPE:SAX - North Sea - Norway - UK
In a two way deal LUPE is increasing itīs operations in the North Sea. 25% share of PL 1176 with
Endeavour taking the 75% share as operator, further PL 304 seeīs LUPE giving up a 25% share to retain 35%
Endeavour is the new partner. Marthon is the operator with a 40% share.. Diversification!
1/6 Lundin Petroleum LUPE:SAX
All things considered I see 150 SEK as a target for this year..
1/6 USA - Iran
Well the US did a policy shift and then some. Iran in direct talks with the US.. First time since 1979.
If Iran does not take the olive branch given them then both China and Russia will probably be
pushed to back the USA/EU stance and sanctions will be - comin a creepin....
Interesting times...
1/6 Canada - Iraq - Western Oil Sands Inc WTO:TSX
Seems like the market did not like the Iraq venture, give it time...
1/6 Lundin Petroleum LUPE:SAX - Valkyries Petroleum VPC:TSX
It seems to me that a lot of investors and financial institutions donīt understand why this deal has been put on the table,
which in itself makes me worry somewhat. Do you not get it? If your answer is yes well then go invest somewhere else
because the oil sector is not your thing. Russia has lotīs of oil and gas and other resources but doing business
there ainīt easy. Lundin Petroleum and Valkyries have here a unique inroad, but VPC is to small to travel further
than it has. VPC and LUPE are Lundin creations, they are their companies they started them and they are heavily invested
in both of them. Do you think they are stupid enough to make a deal that ainīt going to make
them money - and anyone who climbs aboard for the ride!?
Accept the bid and letīs get the hell on with it!
31/5 OPEC - Sudan
Angola and Sudan, which account for more than 1.5 million barrels a day of oil production, are seeking to join OPEC,
according to Ivan Orellana, Venezuela's governor to the oil cartel. The two African nations have submitted their requests.
It's now up to the ministers to decide. Other countries, including Latin American countries, have also requested membership.
It is not apparent which Latin American countries. Angola and Sudan would be the first new members in OPEC since 1971,
when Nigeria joined. Ecuador quit OPEC in 1992, and Gabon left in 1995.
31/5 Valkyries Petroleum VPC:TSX - Q1 Report
31/5 Canada - Iraq - Western Oil Sands Inc WTO:TSX
Set to explore in Iraq.. Worth a gander...
31/5 Oil the Contracts - OPEC - Iran - US Dollar
OPEC are set to meet on Thursday in Venezuela where Chavez will be pushing for lower quotas as he needs a
high oil price to finance his quest against the USA, and also to stay the darling of every nut in the hemisphere
who wants a few petro dollars for his or her quest against the - Big Satan... While still supplying same Satan
with oil... Go figure.
OPEC are rightly worried about decreasing global demand and also the effects an overly high price of Crude on the
global economy. In this the falling dollar is an aspect and as it continues to retreat look for Commodities
to increase accordingly. Note Qatars $50 to $60 range for oil...
Iran - well another week another message from Tehran...
Seriously there are few new points to the problem and the contracts are set to move within the current range...
31/5 Lundin Petroleum LUPE:SAX - Acquire Valkyries Petroleum VPC:TSX
Accept the bid and accept the fact that Valkyries can not or will not gain the advantage of the Lundin family
contacts and network that Lundin Petroleum can and will deliver with VPCīs operations under itīs belt.
Itīs a question of scale and LUPE is growing into a company that more and more oil rich regions of the planet
will want to work with. Diversification both geographically and poltically is the name of the game.
Valkyries which I have followed since the early 80īs has gone through many changes and was in dire straits
more than a few times. The fruit of the labour is the bid from LUPE which may seem less than what most want
but it will turn out to be more than most expected. The Lundinīs are no dummies and the owners of Red Sea Oil
made a very good deal from something that at first resembled the VPC setup ie a bid too low....
Yet this is business and as such you have to ask yourself - is this a good deal?
Having invested in the Lundin Sphere for longer than I can remember I say - Yes!
30/5 Oil - Statistics from the USA DOE - API - 14.30 GMT 1/6
I expect,
Crude + 1.0 mmbls
Gasoline + 2.8 mmbls
Distillates + 2.0 mmbls
Crude Import 9.9 mmbopd
Refineries 90.5%
Gasoline Demand 9.3 mmbopd
Distillate Demand 4.1 mmbop
Natural Gas + 30 billion cubic feet
Total Petroleum Inventories + 4.5 mmbls
Total Motor Gasoline Imports 1.9 mmbopd
Basically more of the same. Both Crude and Gasoline could surprise and then there are the Refiners who are
operating below the year-ago level of 94% still... Look for Motor Gasoline Imports to increase again to
the highest number ever.
29/5 Lundin Petroleum LUPE:SAX - To Acquire Valkyries Petroleum VPC:TSX
Not a big surprise that this deal is put forward, itīs been done before and a future consolidation of all the
minows in the Lundin Sphere is more likelly than not. VPC share owners may feel that the bid is too low yet
one could argue that the VPC share price is too high.. All things considered I see this as a done deal.
25/5 Steel
25/5 OPEC - Sudan
The Sudan has been offered a full memebership of OPEC by the current chairman the Nigerian president..
This then after having been an observer for the last five years.
"President al-Bashir expressed appreciation to the Nigerian president and promised to study the invitation
and respond to it in the future,"
25/5 The Commodity Correction Part Deux
In the US the MTBE to RBOB Gasoline conversion is going smoother than thought especially
on the west coast. The Geopoliticals are taking a breather right now and.. Hey were here all this week.
Trading wise itīs close all positions intra-day and if you can get the frequency right there is money to be made
in this kind of market. One caution is Iran as talks have seemed to stall somewhat.
24/5 Oil - Statistics from the USA DOE - API - 14.30 GMT
Crude - 3.0 mmbls (API - 1.2 mmbls)
Gasoline + 2.1 mmbls (API + 4.3 mmbls)
Distillates + 2.5 mmbls (API + 1.2 mmbls)
Crude Import 9.6 mmbopd
Refineries 89.7% - 0.1%
Gasoline Demand 9.2 mmbopd
Distillate Demand 4.1 mmbop
Total Petroleum Inventories + 3.6 mmbls
Total Motor Gasoline Imports 1.6 mmbopd
SPR 688.6 mmbls +- 0.0 mmbls
Crude imports were down just a smidgen but Gasoline imports were the second highest ever... With Crude up
as much as it was itīs a mixed picture yet Crude storage is 4% above last year so the one that makes the numbers is
Gasoline and this was up again... Gasoline increased for the fourth week and storage is now 2.6% below last year.
As I have stated before though it is Refineries and Gasoline that are the once to watch and in this Refiners are
way below the 93-94% utilization that is usual this time of year. Yet as Gasoline demand is up only 0.3% this year
this may even itself out. At the moment about 200-300.000 mmbls of Gasoline per week are not entering the system
due to still ongoing Katrina-repairs for the refineries.
24/5 Beach Petroleum - BPT:ASX
SELLICKS-2 ,Cooper Eromanga flows oil..
24/5 USA - ETF - United States Oil Fund USO 23/5
Note the dip at the end of Tuesdays trade..
24/5 Oil - Statistics from the USA DOE - API - 14.30 GMT
I expect,
Crude + 0.5 mmbls
Gasoline + 2.5 mmbls
Distillates + 1.0 mmbls
Crude Import 10.8 mmbopd
Refineries 91.8%
Gasoline Demand 9.2 mmbopd
Distillate Demand 4.0 mmbop
Natural Gas + 105 billion cubic feet
Again I expect a build across the board and that means that the US is for the most part more than well
stocked for the coming period. Last weeks slight drop in Refiners should see an increase, also do not forget
that last weeks total motor Gasoline imports averaged 1.45 mmbopd - the third highest weekly average ever.
We could see another large import number...
23/5 The Commodity Correction
Is it over? Well probably not as most commodities have come very far very soon and some for no reason at all.
Corn up 40% whatīs that all about!?..
The market at large has one could speculate been driven by Gold and Oil and made everyone feel that the world
really is spinning faster... Well itīs not and most indicators point to a slowing down due to inflation due to
high commodity prices which give higher interest rates...
Yet one thing has to be said - the market swings the last few dayīs sure make for GOOD TRADING!! And this
seems set to continue.
Itīs the Fundamentals against the Risk/Expectation Premium and when these two diverge then a commodity
correction is never pretty, as most have had a taste of the last week or so...
20/5 Next Week
Look for US Gasoline storage to grow further also look for Natural Gas storage to continue building. Iran is
making more moves to calm the situation down. Look for the fact that Global Demand for Oil is waining to finally
start to get into the heads of those who are the market...
Other than a geoplitical happening well happening I see the contracts continuing their treck down the price scale,
because the world is still not running out of oil... Have a good weekend!
19/5 USA - ETF - United States Oil Fund USO 18/5
Did you sell the short holdings on Friday? I did and took a short holiday... As to when to buy back? Well Friday
will see the usual "risk covering" but I ainīt buying it.
19/5 WTI Front Month - A FishNetŪ Perspective - Weekly
19/5 Updated - The IEA - OPEC - Demand
OPEC has lowered its forecast of world oil demand growth for the year to 1.4 million barrels a day to
total demand of 84.6 million barrels a day. Last week IEA and the DOE said...
The International Energy Agency much like the US DOE in its monthly report, cuts its global demand view to
1.25 million barrels a day from 1.47 million barrels, the reasons mild first-quarter weather and sustained
high oil prices.
Noted is weaker US demand than previously implied by weekly data and also unexpectedly robust
exports from the former Soviet Union. "It appears that companies have sought to maximize exports prior to
increases in export duties in May and June," the IEA said of Russia and surrounding countries.
The dime is about to drop...
19/5 Lundin Petroleum LUPE:SAX - Sudan Block 5B
Drill start moved forward ― to 1 year or....
18/5 Statistics from the USA - DOE - Refiners still down
There are about 60.000 bpd, mostly Gasoline still not making it to the US market due to Katrina related
shut-downs in three refineries. These are expected to be up by June...
18/5 Why the Oilers are taking a beating..
"Nothing corrects the high price of a commodity like the high price of a commodity"...
US inflation is rearing itīs ugly head and so even in the EU because the too high price of commodities..
For those who have read this site the current downturn is no surprise. Did you sell the short holdings on Friday?
The signals warning of this downturn have been out there in big red letters for a long time and I have a
feeling this will continue because yet again - The World Is Not Running Out Of OIL!! OK we are still just below
$70 per barrel but another sell-off will see pension funds especially in the US get worried and a lot of
late commers to the Oil Market will start pulling in their positions. As I have stated before..
18/5 Statistics from the USA - DOE
The DOE reported Natural Gas storage rose by +90 billion cubic feet which makes the total storage at
more than 2 trillion cubic feet as of last week. This then is a storage level that usually does not occur
until mid July ie storage build is 2 monthīs early.
18/5 Oil - Statistics from the USA DOE - API - 14.30 GMT
Crude - 0.1 mmbls (API - 4.2 mmbls)
Gasoline + 1.3 mmbls (API - 2.0 mmbls)
Distillates - 0.1 mmbls (API - 0.3 mmbls)
Crude Import 10.4 mmbopd
Refineries 89.8% + 1.4%
Gasoline Demand 9.2 mmbopd
Distillate Demand 4.1 mmbop
Natural Gas + 91 billion cubic feet
Total Petroleum Inventories + 1.8 mmbls
SPR 688.6 mmbls + 0.5 mmbls.
18/5 No Updates to site since 12/5 due to a short holiday
12/5 The International Energy Agency
The International Energy Agency much like the US DOE in its monthly report, cuts its global demand view to
1.25 million barrels a day from 1.47 million barrels, the reasons mild first-quarter weather and sustained
high oil prices.
Noted is weaker US demand than previously implied by weekly data and also unexpectedly robust
exports from the former Soviet Union. "It appears that companies have sought to maximize exports prior to
increases in export duties in May and June," the IEA said of Russia and surrounding countries.
The dime is about to drop...
12/5 The Oil Market
Yesterday saw the contracts rise due to Nigeria, Valero shut-down and well the rest.. As someone in the market
well this is great every dollar is one more on the pile yet what is the market really driving on?
Iran is ofcourse the biggest worry and everytime the little guy in the gabardine suite opens his mouth his words are
good for another 10 points. Yet a shut-down of a refinery with a 0.2% effect on the Gasoline structure...
"The world does not have a shortage of oil" - Lord John Brown, Chairman of BP.
11/5 USA - Valero Energy - Texas City Refinery
Is to be closed down for about 7 days for repairs effective 10/5. This will take 15.000 barrels per day off
the Gasoline market. About 0.2% of the Gasoline produced in the US....... This then is what the market worries
about... Weird and Wacky!
11/5 USA - ETF - United States Oil Fund USO 10/5
Ask you may why I post the USO graph.. Well itīs because it shows the market as a "cash on the barrel head" reaction.
In this itīs a fund which has a larger spectrum than the contract. This then is analogous for all ETFīs.
10/5 Indonesia - New Oil Refinery
Pertamina and the National Iranian Oil Company (NIOC) are set to build a 300.000 bopd refinery on Java. The oil
to be refined would come soley from Iran.
10/5 Oil - Statistics from the USA DOE - API - 14.30 GMT
Crude + 0.3 mmbls (API - 0.05 mmbls)
Gasoline + 2.4 mmbls (API + 0.9 mmbls)
Distillates + 0.2 mmbls (API + 1.8 mmbls)
Crude Import 10.0 mmbopd
Refineries 90.2% + 1.4%
Gasoline Demand 9.1 mmbopd
Distillate Demand 4.1 mmbop
Natural Gas + 85 billion cubic feet
Total Petroleum Inventories + 5.4 mmbls
SPR 688.1 mmbls + 0.1 mmbls
Crude inventories are at the highest level since the week ending May 1998.. Crude was lower than expected
but Refineries and Gasoline took off last week. So yet another week where the US is not running out of oil...
As I wrote about last week Gasoline demand is waining and is down 0.1% on last year. Yet the summer is long
and Hurricans start rolling in the first week of June. About the same time all US refineries should be up
and running after repair and work-overs. Note that imports averaged more than 1.6 million barrels per day
last week the highest weekly level ever. Note further that The DOE has cut its US demand outlook for
Crude and Gasoline for 2006 into 2007.
Total Natural Gas storage now stand at 1.989 trillion cubic feet, up 488 billion cubic feet from the
year-ago level, and 714 billion cubic feet above the five-year average.
10/5 Australia - Austral Pacific Energy Ltd - APX:TSX - APX:NZSX - AEN:AMEX
10/5 Canada - Chamaelo Exploration - CXN:TSX
This one is worth a look...
10/5 USA - ETF - United States Oil Fund USO
10/5 Lundin Petroleum LUPE:SAX - Sudan Block 5B
I wrote earlier;
*29/3 Lundin Petroleum LUPE:SAX - Sudan Block 5B
Sell the 24.5% interest in Block 5B... The Sudan is going to take years to get right and there are far better
places to go for in the meantime. The Sudan is not going anywhere anytime soon..
I could in this be wrong, yet I think not..*
I still tend to lean to this point of view as the political situation is only slightly better today and then
mainly because there has been considerable media attention directed at the Darfur region. However there are still
many questions to be solved concerning Southern Sudan. Again I do not mind admitting that I am wrong
and I could be in this case yet I do not still belive that it is worth the while today - for LUPE to be
part of the Sudan venture. However if the company stays the course and the share owners realise the true
potential of what could be achived in 5B well then stay in it. This then craves a maturity amongst the stock
holders to see far further than the next quarter, half year or even years...
This then as many have done since the company was formed way back when...
10/5 Iran - The Letter
Wait, oh yes wait a minute mister postman
Wait, wait mister postman
Mister postman look and see
You got a letter in your bag for me
I been waiting such a long time
Ahmadinejad sent Bush a letter.. Big deal. Look for the next form of communication from Iran to be;
Ill send an s.o.s. to the world
Ill send an s.o.s. to the world
I hope that someone gets my
I hope that someone gets my
I hope that someone gets my
Message in a bottle, yeah
Message in a bottle, yeah
9/5 Oil - Statistics from the USA DOE - API - 14.30 GMT 10/5
I expect,
Crude + 1.5 mmbls
Gasoline + 2.0 mmbls
Distillates - 1.5 mmbls
Crude Import 9.9 mmbopd
Refineries 89.4%
Gasoline Demand 9.1 mmbopd
Distillate Demand 4.0 mmbop
Natural Gas + 60 billion cubic feet
Again look for an increase for Gasoline and Crude. Also the refinery numbers should see another up-tick.
Distillate demand should be down as expected. Gasoline Demand should hold at the current 0% change level.
I would however not be surprised if both Gasoline and Crude showed larger than builds...
9/5 Sweden - Energimyndigheten Report - In Swedish
9/5 Venezuela - Oil Tax
Seems to be set at 33.3% in royalties. The confirmation of this by the Chavez controlled National Assembly
is just the rubber stamp. So it will cost foreign oil companies 33.3% to partake in the countries
oil & gas venture. This then up from the 16.67% paid today..
8/5 This Week
The Fed.. enough said! The dollar is down and then some. Iran is as expected making moves to bring it
back from the brink - the fact is that it has few more cards to play. Hurricane season is three weeks away.
The US Stats!! Sorry folks but that is along with the risk premium that which drives the Oil Market - today.
The fact that the contracts took a breather over the weekend despite Iran should tell you something about
the foreseeable future....
Also do not forget the words of Claude Mandil, the executive director of the Paris based
International Energy Agency (IEA), who said that current oil prices aren't sustainable.
"The high oil prices are not consistent with the long-term trend just because they are much higher than the
margin costs of an additional barrel," A case in point Sinopec who saw itīs bottom line suffer by 3.5%
due to the high price of oil...
5/5 Price of Oil & Gas - Close 4/5
Nymex Crude Future 69.94 -2.34
IPE Crude Future 70.29 -2.36
Dated Brent Spot 70.11 -2.55
WTI Cushing Spot 69.94 -2.34
Minas 71.25 -2.91
OPEC 11 66.25 -2.15
Nymex Natural Gas 6.91 +0.30
As to why the across the board drop I gave the reason the day before yesterday... US Gasoline and
Refinery numbers.
4/5 Iraqi oil exports
Iraqi oil exports in April were 1.55 mmbpd, 140,000 up from a revised 1.41 mmbpd figure for March,
due to improved weather. This is then 1.1 mmbpd below the pre-war 2003 level.
4/5 Iran - The Conundrum
Iranian Deputy Oil Minister Hadi Nejad Hosseinian said Wednesday that Iran would continue exporting oil
even if its nuclear facilities are attacked by the United States. We dont use oil as a weapon, he said.
Washington has accused Iran of involvement in a clandestine atomic weapons program. Tehran says it is
pursuing a peaceful nuclear energy program.
This is the tenth time Iran has stated the same line. Why? Well becuase it needīs the oil revenue and with
the US not buying one barrel from Iran the problem is that the main enemy ie the USA is not listening.
Iran is a major supplier of oil to the world, but not to the US. Given that if Iran went off the board
there would be huge problems but not for the US because it imports its oil from everywhere else than Iran.
4/5 Price of Oil & Gas - Close 3/5
Nymex Crude Future 72.28 -2.33
IPE Crude Future 72.65 -1.99
Dated Brent Spot 72.66 -1.92
WTI Cushing Spot 72.28 -2.33
Minas 74.21 +0.35
OPEC 11 66.25 -2.15
Nymex Natural Gas 6.61 -0.11
3/5 Oil - Statistics from the USA DOE - API - 14.30 GMT
Crude + 1.7 mmbls (API + 2.0 mmbls)
Gasoline + 2.1 mmbls (API + 4.0 mmbls)
Distillates - 1.1 mmbls (API - 1.3 mmbls)
Crude Import 9.8 mmbopd
Refineries 88.8%
Gasoline Demand 9.1 mmbopd
Distillate Demand 4.1 mmbop
As I expected Gasoline saw an increase and then some.. Refiners only ticked up a smidgen, yet every
little bit helps. Again a disparity between the API - DOE numbers, which is more common than not.
Gasoline demand is the same as one year ago and I have a feeling that demand is going to drop going forward,
not much but just the simple fact that demand is 0% changed from last year should tell everyone what
this market really is all about... OK ethanol conversion is going to throw a spanner in the works yet thus
far the Gasoline market is pretty much like the year before, so far... Three major refineries are still down
since Katrina also a factor that accounts for part of the 5% drop in storage levels. With May running out
day by day itīs all about RBOB and CARBOB.. ie ethanol addatives and West Coast Gasoline.. Check the contracts!
Gasoline storage levels are 4.9% below last years level.
Crude storage levels are 5.3% above last year.
Disitillate storage levels are 9.9% above last year.
Natural Gas storage levels are 60% above the 5-year average....
"Nothing corrects the high price of a commodity like the high price of a commodity"
3/5 Oil - Statistics from the USA DOE - API - 14.30 GMT
I expect,
Crude + 1.5 mmbls
Gasoline + 0.5 mmbls
Distillates - 1.0 mmbls
Crude Import 10.1 mmbopd
Refineries 89.5%
Gasoline Demand 9.1 mmbopd
Distillate Demand 4.1 mmbop
Natural Gas + 40 billion cubic feet
As more refiners numbers show up in the stats I am going out on a limb and expecting Gasoline supplies
to have grown for the first time in eight weeks.
29/4 Next Week
We now know what we all knew ie that the IAEA said what it said about Iran so that issue is on too phase 2,
Venezuela has been off-the-map this week but Cahvez can always be counted on to do whatever he does.
Nigera has also taken a second seat and then there is the rest. I forget that Monday is labour day so count
on Chavez to say something, outrages...
The big one next week however is the DOE - API numbers concerning Gasoline and Refineries. This alone will drive
the market more than the above lot, unless something else happens.. Interesting times that crave a quick trigger
finger if you are trading this on the short term moves, as you bloody well should.
Again the US DOE - API numbers concerning Gasoline and Refineries are the....
28/4 Iran - IAEA - UN
Whatever the IAEA report states the process ahead is going to be slow and will take weekīs if not months.
As with most thingīs involving the UN this will be a painfully slow process.
Tehrans stance today is partly about "keeping my job" ie Ahmadinejad and his government need someone to blame for the
mess the country is in and then why not the US, UN, EU etc.. Especially as there is talk of Gasoline rationing
coming into play and Iranīs oil & gas industry could be in better shape.
I do belive though that Iran on the current road will sooner or later become a battlefield with little support
given to itīs wayward course by pretty much anybody. Iran is Persian in a sea of Arabic nations and in the
west Iran has few friends, just mainly vendors to the countries consumers. If Iran attains the bomb then Turkey
will want one and Saudirabia, etc..
28/4 Price of Oil & Gas - Close 27/4
The Contracts reflect the mood. Iran will work itself out and the drivning force right now is the waining Gasoline
demand in the US and the resurgence of US Refiniers.
The Fundamental downward pull on the market is there and can not be denied.
28/4 USA - ETF - United States Oil Fund USO
27/4 Price of Oil & Gas - Close 26/4
Nymex Crude Future 71.70 -1.04
IPE Crude Future 72.09 -1.12
Dated Brent Spot 72.31 -0.94
WTI Cushing Spot 71.93 +5.05
Minas 72.84 -0.39
OPEC 11 65.05 -1.22
Nymex Natural Gas 7.20 -0.10
Worth noting is that Iran on the penultimate day of UN reckoning has again shown itself to be run by clerics
with the mental mindset of any three year old child... And still the complex drops..
US Refiners is the real reason...
26/4 Oil - Statistics from the USA DOE - API - 14.30 GMT
Crude - 0.2 mmbls (API + 3.5 mmbls)
Gasoline - 1.9 mmbls (API - 3.2 mmbls)
Distillates + 1.0 mmbls (API + 0.8 mmbls)
Crude Import 9.9 mmbopd
Refineries 88.2%
Gasoline Demand 9.1 mmbopd
Distillate Demand 4.1 mmbop
Natural Gas + 80 billion cubic feet
There you have it Refineries are coming back.. Up from 86.2% over the week. The Gasoline numbers are all about
the switch to ethanol based fuel and the ability of the industry to comply.. Gasoline storage is now 5.6% below
the one year level, Crude + 5.6% and Distillates are + 11% above the one year level.
26/4 USA - ETF - United States Oil Fund USO
As I said this fund lookīs like it could be a tracker..
26/4 Price of Oil & Gas - Close 25/4
Nymex Crude Future 72.74 -0.14
IPE Crude Future 73.21 +0.21
Dated Brent Spot 73.26 +0.20
WTI Cushing Spot 66.88 -2.20
Minas 73.18 -0.28
OPEC 11 66.27 -1.10
Nymex Natural Gas 7.30 +0.05
25/4 Oil - The Contracts & Oil Company Stocks
As the contracts retreat look for an accelerated down-turn in the stock price of most oilers as they have come
a long way of late. Share prices elevated by Risk Premium always tend to settle faster as we have again seen
examples of today here and there.. This then leads to short term opportunity...
25/4 Oil - Statistics from the USA DOE - API - 14.30 GMT 26/4
I expect,
Crude + 1.5 mmbls
Gasoline - 2.5 mmbls
Distillates - 2.0 mmbls
Crude Import 10.1 mmbopd
Refineries 87.9%
Gasoline Demand 9.2 mmbopd
Distillate Demand 4.0 mmbop
Natural Gas + 60 billion cubic feet
So how much Refinery capacity has come back online, or rather how much of restarts have trickled down the system..
The Refinery numbers along with Gasoline is what itīs all about.
I have a feeling this week could see a surprise in the numbers mainly the Crude stats..
Also note the comments by President Bush concerning directing the EPA to ease the federal fuel standards...
25/4 Iran
Anyone else get the feeling they are getting a bit desperate in Tehran?
First they test all kinds of esoteric weapons just to show that they are - Peace Loving Folk..
Now itīs down to pointing out that the price of Oil still is not high enough... Friday will be interesting.
25/4 USA - An increase in the SPR
The DOE is mulling the idea of increasing the SPR to 1 billion barrels from todays 725 mmbls, effective today 684 mmbls.
What a novel idea.. The first one since 1975...
21/4 A few that I have not mentioned for awhile - yet they are still there..
21/4 Tanganyika Oil - TYK:TSX - TYKS:NMG - A Target
So my target set on 31/3 of 120 SEK has been met. The Q now is where do we go from here.. Well given the current
rally environment itīs all about "how long is the string"? Speculation in this smaller oiler could drive the stock
to 130 SEK short term, yet the legs are getting mighty long...
21/4 Commodity Crash - Itīs out there..
I have written earlier about this.. And have stated for a longer while the concern that the massive Correction
is out there.. The last few dayīs of Crude rally only strengthens this belife as itīs all Risk-Run! Check EIAīs
demand numbers and the small talk from OPEC about the worry of keeping Demand Up.. The USAīs problem with MTBE/RBOB
notwithstanding.. Enjoy the Rally and itīs Sweet Fruits but all good things end... With commodities itīs usually not pretty.
20/4 Cairn Energy PLC UK - CNE:LSE - Looking for Oil in Nepal
Has unveiled another find in Rajasthan and named the chief executive
for the Indian division. A listing in Bombay is in the works... *G*
19/4 Oil - Statistics from the USA DOE - API - 14.30 GMT
Crude - 0.8 mmbls (API - 4.0 mmbls)
Gasoline - 5.4 mmbls (API - 3.3 mmbls)
Distillates - 2.8 mmbls (API - 2.8 mmbls)
Crude Import 9.7 mmbopd
Refineries 86.2%
Gasoline Demand 9.1 mmbopd
Distillate Demand 4.1 mmbop
As we head into summer Distillates inventories back off. The Crude and Gasoline nummbers are again
influenced by the switch over to RBOB and the low Refinery runs. Interesting times..
13/4 Oil - VLCC Freight Rates
Freight Rates are holding at about $33,900 a day.
13/4 So where does the USA Import its Oil from
CANADA 1,8 mmbopd
MEXICO 1,7 mmbopd
VENEZUELA 1,5 mmbopd
SAUDI ARABIA 1,3 mmbopd
NIGERIA 1,1 mmbopd
IRAQ 0.5 mmbopd
ANGOLA 0.4 mmbopd
ECUADOR 0.4 mmbopd
ALGERIA 0.2 mmbopd
COLOMBIA 0.2 mmbopd
TRINIDAD AND TOBAGO 0.1 mmbopd
EQUATORIAL GUINEA 0.1 mmbopd
CHAD 0.1 mmbopd
KUWAIT 0.1 mmbopd
NORWAY 0.07 mmbopd
IRAN 0.00 mmbopd
13/4 USA - ETF - United States Oil Fund USO
I think it might be interesting to track this "cash on the barrel head" indicator..
12/4 Oil - Statistics from the USA DOE - 14.30 GMT
Crude + 3.2 mmbls (API + 4.3 mmbls)
Gasoline - 3.9 mmbls (API - 3.5 mmbls)
Distillates - 4.2 mmbls (API - 4.6 mmbls)
Crude Import 9.5 mmbopd
Refineries 85.6%
Gasoline Demand 9.1 mmbopd
Distillate Demand 4.1 mmbopd
Natural Gas + 19 billion cubic feet (13/4)
The first build in Natural Gas storage for the season.
The big surprise was Distillates yet as winter is drawing to a close far less of a concern than Gasoline even if
diesel fuel was part of the drop in inventories. Refiners are still - still for the most part so itīs in that
context the Stats should be viewed. Refiners are running at about 10% below normal summer refining output...
Gasoline inventories are 2% below last year. Crude is 8% above last year and the highest in 8 years and
Distillates are 12% above last year. Itīs Gasoline boys and girls... RBOB.
12/4 USA - ETF - United States Oil Fund USO
Closing price after two days of trade..
12/4 Oil - Statistics from the USA - 14.30 GMT
I expect,
Crude + 3.0 mmbls
Gasoline - 3.0 mmbls
Distillates - 1.0 mmbls
Crude Import 10.0 mmbopd
Refineries 86.5%
Gasoline Demand 9.2 mmbopd
Distillate Demand 4.0 mmbopd
Natural Gas + 40 billion cubic feet
If you thought last week was tricky.. well. All US refineries should be back on track by late June so until
then itīs a matter of how much Gasoline is being refined - this week.. Itīs all about Gasoline and RBOB or
MTBE.. Look for Natural Gas to start climbing as winter is over and etc..
12/4 Iran - Nuclear Enrichment
So Iran has enriched Uranium in a Petri Dish... The little guy in the gabardine suite got all the Mullahs really
worked up about that one..
11/4 WTI - Brent
The Brent contract is due to change front month so look for the usual expiration trade. Also we are
heading into a long weekend and that usually does mean hedging for anything.. Iran and the rest are
going to flavour the contracts the rest of the week. WTI to follow Brent and test the high?
Remember that the Brent contracts make up about 65% of the worlds oil that is bought and sold so
Brent is a powerfull driving force for the Oil Complex.
11/4 USA - ETF - United States Oil Fund USO
Last: 68.02-0.23-0.34%
12:06am 04/11/2006
11/4 Oil Contracts - USA & Iran etc..
So do we belive that the US going to attack Iran? Well... Thatīs the question yet it does seem improbable
as it would open a Pandoras Box of troubles. Are the contracts hedging the bet? Well yes and no, as I recall
a comment made today that the Risk Premium is not large enough to cover all the possible risks that are
just that risk. Donīt forget Hurricanes, Venezuela, Nigeria etc..
Nigeria is and has been a problem for a long time.. Venezuela is more a nuisance as I do not belive Chavez
is stupid enough to really do what he sayīs he wants ie stop export to the US. For one thing Venezuela
through itīs US based Oil Company CITGO has 1500 service stations in the US. Add to this the Heating Oil
sales that CITGO make in the US.. Too much loss on top of the export revenue from the countries largest Oil customer.
So itīs back to Iran. Would I be surpised by a "Breaking News" segment on CNN - "Attack on Iran!" No I would
not yet I have a hard time beliving that it will happen just because if it does happen it will be more than a
$100 oil thing it will be a $300 Oil thing! In this would the US, OPEC and Iran be stupid enough to stop
the world economy!? I think not.
The problem with Iran will be worked out....
If not well then at $300 WTI Iīll sell all my oil contracts and stocks and buy a smaller sized country.
Far away from WW3...
So there you are itīs all about the - Risk Premium, again. What do you belive...?
10/4 Lundin Petroleum LUPE:SAX - Sudan Oil Analysis
An interesting read... given that it is mainly a historical perspective on the strategies that drive
companies to look for oil in countries like the Sudan. The conclusions are a bit fluffy, yet as an
insight and one view of the situation it is as I say - interesting.
9/4 Commodity Crash - Itīs out there..
I wrote earlier.. And have stated for a longer while the concern that..
*21/3 Commodity Crash - Itīs out there..
Commodities unlike other sectors do change the landscape when they return to a state of balance.
IT, property, banking, etc booms/bubbles make their mark but when Commodities realign, well it makes
the world shudder. Most commodities have seen spectacluar runs to the upside, yet as history teaches us
nothing grows to heaven.
I have a feeling that there is a major Commodity Correction out there lurking in the shadows and itīs
heading this way. Why? Well simply put - The Price! The high price of everything from Gold, Copper, Platinum
Silver and Crude, etc means that everyone with production in these sectors are producing to the Max. Sooner or
later the demand side of the duo will run out of breath and then itīs time for the old, "Ketchup Effect"...
and in this my belife that it is closer at hand as not abated but rather increased.
For oil well $45 is my Fair Value estimate.. As to the exact date for this to occur well that is another thing
yet if you have followed this site then when it does occur it will not be news but rather history reconfirmed.
Donīt forget - history!
8/4 Iraq - DNO
The Norwegian oil company has hit it big in Kurdistan.. *G*
7/4 USA - RBOB Contracts
Trade in the NYMEX:RB contracts have been running congruent with Unleaded Gasoline for some time
yet itīs the July contract that has seen - any action..
6/4 USA - RBOB - MTBE...
A cleaner Gasoline is called for by the Federal Government and it must be implemented by May.
The new fuel is RBOB. RBOB is short for reformulated gasoline blendstock for oxygenate blending
and MTBE is short for methyl tertiary-butyl ether, a gasoline additive that must be phased out by May.
As there are technical difficulties in the transition this is going to put a cloud over Gasoline Refining,
as I have stated earlier. Basically what refiners are doing is cleaning out tanks from the old MTBE for
shipping to other countries that donīt have the restrictions. This is the interesting bit....
Once the tanks are clean then itīs RBOB all the way. This will take time and it will casue much problems
for the Gasoline market, as stated before.
5/4 Oil - Statistics from the USA - 14.30 GMT
Crude + 2.1 mmbls (API + 4.2 mmbls)
Gasoline - 4.4 mmbls (API + 0.4 mmbls)
Distillates - 2.6 mmbls (API - 1.7 mmbls)
Crude Import 10.0 mmbopd
Refineries 85.9%
Gasoline Demand 9.1 mmbopd
Distillate Demand 4.1 mmbopd
Natural Gas - 10 billion cubic feet (6/4)
Natural gas inventories are 447 Bcf higher than last year at this time and 654 Bcf above the 5-year
average of 1,041 Bcf. Inventories are nearly 70% above average at 1.695 trillion cubic feet...
Itīs the refinery situation that is making the Gasoline numbers run. The Total commercial petroleum inventories
declined by 4.6 mmbls last week, but still remain well above the upper end of the average range for this
time of year. Crude inventories are at the highest level since the week ending April 9, 1999.
Look for volatility as far as Gasoline goes to pick up going forward. Even so it should be pointed out
that Gasoline inventories are still above the average amount and with a normal demand season should give less
effect.. That is as it stands right now it should be added.
Yet I see the biggest problem for US Refineries - the conversion to clean Gasoline and this is I belive the primary
reason why utilization dropped. Hovensa is back online donīt forget and Hovensa is the Northen Hemispehers largest
refinery...
4/4 Oil - Statistics from the USA - 5/4 14.30 GMT
I expect,
Crude + 3.5 mmbls
Gasoline - 2.0 mmbls
Distillates - 2.0 mmbls
Crude Import 10.3 mmbopd
Refineries 87.4%
Gasoline Demand 9.2 mmbopd
Distillate Demand 4.1 mmbopd
Natural Gas + 35 billion cubic feet
This week is hard to call as we are in transition between winter and summer demand. Hovensa's St. Croix
500.000 bopd refinery came back online during the weekend and is running on full. This will take time to
filter down through the complex though, two to three weeks. Otherwise itīs all about the conversion to
cleaner Gasoline and this one is very hard to call and really we will not know the total effect until
later during Q3. Refiners should tick up again as more come back online. Naturals Gas should show a build
for the first time this winter season..
I would like to point out that Hovensa is a joint venture with Venezuela's State Oil Company....
4/4 Australia - Uranium
The deal is done and the China National Nuclear Corp, CNNC is in country looking for long term contracts
with companies from Oz..
3/4 Oilex NL - OEX:ASX
Another one worth a good look... Oman just rolled in..
3/4 Editorial - in todays, The Australian Newspaper
Editorial: The Doomsday clock
The UN is naively giving Iran more time to develop nukes
April 03, 2006
THIRTY days. That's how long the UN Security Council gave Iran last week to stop trying to enrich uranium,
which could be used for an atomic bomb. And if Iran doesn't politely withdraw its application to join the
nuclear club by the time the clock runs out, well, the UN will just have to meet again. Doesn't sound like
much of a threat, does it? Especially when you consider the original 30-day deadline was only approved by
the Security Council's 15 members after China and Russia refused to sign off if punitive measures were
included in the demand. Or that the day after the ultimatum was issued, talks over what to do next fell apart.
Sanctions, one of the only options available to the UN, were reportedly rejected out-of-hand by
Russian Foreign Minister Sergei Lavarov as impractical. And as disingenuous as Mr Lavarov's statement may
have been, he's also right: Iran exports 2.5 million barrels of oil a day and holds the world's second-largest
natural gas reserves -- facts that make any sort of sanction or blockade economically unlikely.
Furthermore, Iran's senior ministers have openly bragged about their ability to deceive the West about their
nuclear program, while Iranian President Ahmadinejad has publicly declared his desire to wipe Israel off the
map and is said to be obsessed with the Shi'ite "12th imam", whose coming will herald the end of the world.
Can these people really be trusted with the most powerful weapons known to man?
Mr Ahmadinejad's rhetoric places him well outside the boundaries of what Westerners would describe
as a "rational actor". But his quest for a nuclear weapon falls within the very rational
Middle Eastern penchant for non-conventional warfare that has developed in recent decades.
It has been centuries since conventional Muslim or Middle Eastern armies have achieved success
on the battlefield; the prophet Mohammed and his succcessors may have been skilled generals able to rapidly
spread their new faith over vast swaths of territory, but modern military success has eluded the Islamic world.
Seeing the utter disaster -- from their point of view -- of the Six Day War, the bloody stalemate of the
Iran-Iraq war and the routing of Saddam Hussein's armies in two Gulf Wars, it is not surprising Middle Eastern
leaders are keen to develop non-conventional means of warfare. While often tactically disastrous, low-level
non-traditional campaigns such as the use of suicide bombers by Palestinians or insurgency tactics by the
terrorists in Iraq have been highly successful in gaining headlines (and even sympathy in some quarters) for
some pretty evil people who are more than happy to massacre civilians in exchange for a news grab.
Mr Ahmadinejad and his ilk see sophisticated non-traditional weapons as a way to get not just headlines,
but strategic results.
The Australian noted recently that Iran's nuclear program was a chance for the UN and its enthusiasts to prove
the power of multilateralism to solve an international crisis. So far that hasn't happened, and with each day
that ticks by under the UN's phony deadline, Iran is that much closer to acquiring a nuclear bomb. Should that
occur, it is anyone's guess what Mr Ahmadinejad will do next -- especially given his equally aggressive missile
program, which puts Israel and even some European capitals within range. Military action against Iran has often
been dismissed as impractical or impossible, but this defeatist rhetoric immediately gives the game away to
the mullahs in Tehran who laugh at, rather than bow to, the moral authority of the UN. Never since the end of
World War II have nuclear weapons been so close to the grasp of someone so likely to use them. The Iranians must
not be allowed to acquire an atom bomb, and if the UN cannot stop them, someone else will have to.
3/4 MOSAIC OIL NL - MOS:ASX - MOS:POMSOX
Check this one out...
2/4 Oil - Statistics
Why does the oil market center on the US Stats for storage, demand, refiners etc. The answer is
simply that the DOE is the only organisation globally that publishes these numbers with regular frequency.
This then is somewhat puzzeling as the EU is the largest importer of oil.
Worlds largest importers of Oil (percentage of total):
EU 30%
North America 25%
Asia 15%
Japan 12%
China 8%
Korea 7%
Other 3%
As a sample statistically one has to agree that a 25% return on a questionnaire is pretty good going. That
is why the market takes such heed of what is published by the DOE and in a smaller part the API, the latter
a lobby/interest group for the US oil industry. The stats for the EU, OECD and IEA can ofcourse be found at,
yet they are more general in the return and have little real-time relevance. Also two of the three above pretty
much mirror the same information/forecasts which is the IEAīs. The DOE numbers give a picture of the market today
and then for a quarter of the oil consuming world. It would ofcourse be very beneficial if the EU could
muster the same detailed stats every week..
1/4 Oil - VLCC Freight Rates
Lotīs of tankers and nothing to do..
VLCC Freight Rates are down and then some, availability of tankers is up and then some. So is this
a question of too many ships or too little cargo. Rates have come down from $200.000 a day two years ago
to about $30.000 a day today. The number of inactive tankers today is about three times higher than
this time last year.
Just a thought...
1/4 West African Crude is Sweet
Angola passed Saudi Arabia last month as Chinas largest oil supplier. Angola shipped 456.000 bopd to China
during Jan-Feb this year which is 15% of Chinas total import. Congo supplied 140.000 bopd and
Equatorial Guinea 133.000 bopd. The moost interesting part of the story is that West African Crude is "sweet"
and of good quality. Also the production levels and more importantly the proven oil reserves in the
African West are increasing at an impressive amount. Angolas oil reserves have tripled in the past seven years
and production is expected to be 2 mmbopd in 2008 up from todays 1.3 mmbopd.
OK most African states are less than calm and easy to do business in but there is oil there, the Gulf of Guinea
holds 33.8 bln barrels of proven oil reserves, 3.1% of the global total. Taking into account unproven reserves
this increases West Africa's share to around 7% of the world's total. Not much in comparison but then
you have to remember that these numbers have been attained in a climate of less than perfect harmony as
far as prospecting goes.
1/4 USA - 2006 Farm Sector Forecast
Net farm income is forecast to be $56.2 billion in 2006, down from 2005 by $16.4 billion but slightly
above its 10-year average of $55.7 billion. The 2-year period 2004-2005 was one of unprecedented income
creation for the U.S. farm sector, when both crop and livestock commodities experienced exceptionally
favorable market and/or production conditions.
The projected decline for farm income results from several components on both the income and expense
sides of the ledger. The value of production is forecast to be down $2.3 billion for crops and
$2.9 billion for livestock, a little over 2 percent for each. Government payments are forecast
to decline $4.5 billion. Purchases of manufactured inputs are expected to rise by $2.6 billion due to
higher fuel and fertilizer prices, with the latter resulting from high prices for natural gas.
Payments to stakeholders are forecast to be up $2.3 billion, led by rising interest payments on
debt and higher expenditures for labor. Expenditures for other purchased inputs are forecast to
be up $2.2 billion, reflecting higher fuel prices, labor costs, and interest rates.
The value of total production in the U.S. farm sector is forecast to be $267 billion in 2006,
following the record $279 billion in 2004 and $271 billion in 2005. For 2006, the value of crop production
is projected to be down $14.4 billion from its high in 2004 but still $3 billion above its average in the
previous 10 years. The value of livestock production is expected to be down $2.9 billion from 2005,
but still $20.8 billion above its 10-year average.
Just something I like to keep an eye on - as part of the larger picture..
31/3 Tanganyika Oil - TYK:TSX - TYKS:NMG - A Target
As shown below todayīs share price is not a surprise. So whats a realistic target short term?
Given the fact that this company has only just over 48 million shares issued well itīs all
basic mathematics. A realistic target mid year 120 SEK.
*2/12 Tanganyika Oil - TYK:TSX - TYKS:NMG
So why did big daddy Lundin buy all those shares.. *G*
*23/8 Tanganyika Oil - TYK:TSX - TYKS:NMG
I see this puppy at 90 SEK this year...
Why? Because thatīs what happens in the Weird and Wacky World of Upstreamers.
Also there are Fundamental Reasons why for..
31/3 Oil - The Contracts
I have to reiterate that I think the price levels in the contracts have gone too far North. Asian trade
today saw many wonder why they should pay $67 for front month WTI. I have to agree..
Given there are many things that do worry like Iran, Venezuela saying bye bye to Exxon, Nigera etc, yet
this is in the risk premium column which today is an easy $20....
OK there are fundamental worries aswell, for instance about 24% of Gulf of Mexico production is still
off-line since last years Hurricane Season and the US is as always looking for Gasoline for the summer.
Refiners in the US region are still down for repairs and work-overs. Even so I feel itīs just too much
chasing the Bulls Tail at the moment.. This then different from Riding the Bull..
31/3 Tanganyika Oil - TYK:TSX - TYKS:NMG - O-list Listing on SAX
Hardly surprising or unexpected is the fact that the Company has sought a "better" listing on SAX..
30/3 Tanganyika Oil - TYK:TSX - TYKS:NMG - Oil Reserve Report
29/3 Oil - Statistics from the USA - 10.30 EST
Crude + 2.1 mmbls
Gasoline - 5.4 mmbls
Distillates - 2.5 mmbls
Crude Import 10.1 mmbopd
Refineries 87.0%
Gasoline Demand 9.1 mmbopd
Distillate Demand 4.2 mmbopd
Natural Gas - 104 billion cubic feet (30/3) Total stocks now stand at 1.705 trillion cubic feet,
up 459 billion cubic feet from the year ago level, 651 billion cubic feet above the five-year average.
As I said Gasoline.. Refineries are up as I expected by just a tick and they are 7-8% below the spring/summer
levels. Hovensa's St. Croix Refinery is a 500.000 bopd operation and that shows up in the stats..
Even so the totals all show above average storage numbers so it comes down to Demand.
The MTBE or the new clean-air additive ethanol situation is the jack-in-the-box this summer.
Much of the draw-down of Gasoline stocks is in part due to this as Refiners turn production to the
clean-air additive ethanol gasoline.
This will become more apparent as the weeks go forward and the conversion to clean-air additive ethanol alternatives
is likelly to go on through to the autumn. This will skew the stats and they should be seen in this light.
29/3 Australia - Uranium
Prime Minister John Howard has met the Chinese and well letīs say that Uranium is on the agenda..
40% of the global amount of the stuff is found in country..
27/3 Iceland - Iceland Deep Drilling Project
An alternative energy source that actually makes sense.
22/3 Oil - Statistics from the USA - 10.30 EST
Crude - 1.3 mmbls
Gasoline - 2.3 mmbls
Distillates - 0.8 mmbls
Crude Import 9.3 mmbopd
Refineries 86.7%
Gasoline Demand 9.1 mmbopd
Distillate Demand 4.3 mmbopd
Natural Gas - 23 billion cubic feet (23/3)
Refinery runs are up again and should keep increasing going forward as refiners come online. Otherwise
this week was a surprise.. Gasoline is ofcourse the one to watch going forward.
22/3 Lundin Petroleum LUPE:SAX - Sudan
I donīt see anything happening in the Sudan this year. Reason - the political situation.
In fact as far as I see it forget the Sudan for the foreseable future.
I could in this be wrong, yet I think not...
21/3 Oil - Statistics from the USA - 22/3 - 10.30 EST
I expect,
Crude + 3.5 mmbls
Gasoline + 1.5 mmbls
Distillates - 2.0 mmbls
Crude Import 10.1 mmbopd
Refineries 86.5%
Gasoline Demand 9.0 mmbopd
Distillate Demand 4.3 mmbopd
Natural Gas + 20 billion cubic feet
21/3 Does the Gulf of Mexico Hold as Much Oil as Saudi Arabia?
Mexicos giant Cantarell oil field, in the Gulf of Mexico off the Yucatan, was supposedly
discovered in 1976 after a fisherman named Cantarell reported an oil seep in the Campeche Bay.
Last week, Mexico announced finding another giant oil field off Veracruz, the Noxal, estimated
to hold more than 10 billion barrels of oil.
Exploration yielded surprising results. It turned out that Mexicos richest oil field complex
was created 65 million years ago, when the huge Chicxulub meteor impacted the Earth at the end
of the Mesozoic Era. Scientists now believe that the Chicxulub meteor impact was the catastrophe
the killed the dinosaurs, as well as the cause for creating the Cantrell oil field.
The impact crater is massive, estimated to be 100 to 150 miles (160 to 240 kilometers) wide.
The seismic shock of the meteor fractured the bedrock below the Gulf and set off a series of
tsunami activity that caused a huge section of land to break off and fall back into the crater under water.
Proponents of the abiotic, deep-earth theory of the origin of oil point argue that the deep
fracturing of the basement bedrock at Cantarell caused by the meteors impact was responsible
for allowing oil formed in the Earths mantle to seep into the sedimentary rock that settled in
the huge underwater crater. Geologists have documented that the bedrock underlying the crater
shows melt rock veinlets pointing to large megablock structures as well as a long thermal and fluid transport
as part of the post-impact history. In other words, the bedrock at Cantarell did suffer sufficiently
severe fracturing to open the bedrock to flows of liquids and gases from the deep earth below.
An important, but neglected, study of the bedrock underlying the Saudi oil fields provided strong evidence
that the oil fields resulted from fractures and faults in the basement rock, not from a disproportionately
large number of dinosaurs having died for some reason or another uniquely on the Arabian Peninsula.
The study published in 1992 by geologist H.S. Edgell argued that the Saudi oil fields, including the giant
field at Ghawar, were produced by extensional block faulting in the crystalline Precambrian basement
along the predominantly N-S Arabian Trend which constitutes the old grain of Arabia.
In other words, according to the abiotic, deep earth theory of oils origin, we do not have to assume that
all the dinosaurs herded like Elephants to Saudi Arabia at the end of the Mesozoic Era, where they died in a
giant heap that produced oil. Bedrock cracks, whether or not due to meteor impacts, can serve to open the
above sedimentary layers to trap oil deposits seeping upward.
Until the 1960s, geologists considered collisions of extraterrestrial objects with the Earth as interesting,
but not necessarily important. Since Cantarell was discovered, geologists have come to realize that the
intense shock waves generated in meteor impact events have significantly shaped Earths surface, distributed
its crust, and fractured its bedrock. Over 150 individual geological structures, many masked over by
subsequent sedimentary deposits, have been identified as important, ranging from circular impact bowls measuring
from only a few kilometers in diameter to as much as 200 kilometers (approximately 125 miles) in diameter.
Moreover, Cantarell has stimulated interest in meteor impact structures as potential locations to explore in
order to find oil producing sites.
In recent years, we have only begun exploring the Gulf of Mexico for oil. So far the results are impressive.
Instead of imploring Congress to examine the oil producing potential of wood chips and switch grass, President
Bush may be better advised to press ahead to extend oil exploration into the Gulf of Mexico to the limits
current technology will permit.
Wouldnt the Bush administration and other peak oil advocates be surprised to find that a
resource as close as the Gulf of Mexico might just rival the
260 billion barrels of oil reserves Saudi Arabia currently claims?
21/3 Commodity Crash - Itīs out there..
Commodities unlike other sectors do change the landscape when they return to a state of balance.
IT, property, banking, etc booms/bubbles make their mark but when Commodities realign, well it makes
the world shudder. Most commodities have seen spectacluar runs to the upside, yet as history teaches us
nothing grows to heaven.
I have a feeling that there is a major Commodity Correction out there lurking in the shadows and itīs
heading this way. Why? Well simply put - The Price! The high price of everything from Gold, Copper, Platinum
Silver and Crude, etc means that everyone with production in these sectors are producing to the Max. Sooner or
later the demand side of the duo will run out of breath and then itīs time for the old, "Ketchup Effect"...
21/3 Price of Oil & Gas - Close 20/3
Nymex Crude Future 60.42 -2.35
IPE Crude Future 61.34 -1.92
Dated Brent Spot 60.80 -1.86
WTI Cushing Spot 60.42 -2.35
Minas 60.19 -0.92
OPEC 11 56.23 -1.44
Nymex Natural Gas 6.83 -0.22
Fundamentals and profit taking... Also Iran is moving off the board somewhat, Nigeria is a
worry with 620.000 mmbopd off the market due to The Movement for the Emancipation of the Niger Delta
blowing things up left rigth and center. Then there is the Dollar and this is one major aspect
that often is lost in translation. Yet as I have stated take the Geopoliticals out of the equation
and the Fundamentals kick in.....
21/3 Oil & Natural Gas - Spot Price - 1 Year
21/3 WTI Front Month - A FishNetŪ Perspective - Daily & Weekly
17/3 Oil Reserves by Country - 2005
| Rank | Country | Proven Reserves (billion barrels) |
|---|---|---|
| 1. | Saudi Arabia | 261.9 |
| 2. | Canada | 178.8 |
| 3. | Iran | 125.8 |
| 4. | Iraq | 115.0 |
| 5. | Kuwait | 101.5 |
| 6. | United Arab Emirates | 97.8 |
| 7. | Venezuela | 77.2 |
| 8. | Russia | 60.0 |
| 9. | Libya | 39.0 |
| 10. | Nigeria | 35.3 |
Well a 2%+ jump in Refinery Output... The big surprise was Distillates. crude oil inventories
are at the highest level since the end of May 1999.. The Total Stocks of Crude, Gasoline and most
Distillates are 5% above last years level..
15/3 Oil Sands - Canadian Companies
An often very misunderstood part of the Oil Sector are Oil Sands.. The new extraction techniques are
making big headways into lowering the production costs of these companies. Canada is second to none
with Saudiarabia number two in the reserve league. All in all Oil Sands are found in about 70 countries
world wide. The other major reserve is to be found in Venezuela of all places..
8/3 Oil - Statistics from the USA - 10.30 EST
I expect,
Crude + 2.8 mmbls
Gasoline - 0.5 mmbls
Distillates - 2.0 mmbls
Crude Import 10.1 mmbopd
Refineries 84.7%
Gasoline Demand 9.0 mmbopd
Distillate Demand 4.3 mmbopd
Natural Gas - 115 billion cubic feet
2/3 Lundin Petroleum LUPE:SAX
Most of LUPEīs produced oil is today sold at spot prices, this then a change from the last few years..
Just a reminder......
2/3 Oil - Geopolitics
Al Qaeda has it seems had a two year plan in effect to disrupt Saudi and Iraqi oil installations.
This coupled with the rest of the mayhem on the global scene is pushing the contracts north.
The risk premium is the norm and as such much revenue is handed to the oilers...
2/3 DALS ED VÄNERSBORG - Dalslandsbonden Stig Engdahl
Off-topic för sidan dock inte..
Demonstrationerna för Dalslandsbonden Stig Engdahl visar bara att det finns många människor som lever
kvar på 1200-talet. Vargskräck i dagens upplysta samhälle är bara att jämföra med urminnestiders skrock
och avsaknad av bildning.
Att Dalslandsbonden Stig Engdahls sak stöds av bland annat Jägarförbundet samt populistiska politiker är inte att
förundras över snarare tvärtom..
Kunskapspoolen är tyvärr oftast mycket, mycket grund och grumlig i vissa kretsar...
1/3 Oil - Statistics from the USA - 10.30 EST
Crude + 1.6 mmbls
Gasoline + 0.3 mmbls
Distillates - 1.5 mmbls
Crude Import 9.9 mmbopd
Refineries 85.2%
Gasoline Demand 9.0 mmbopd
Distillate Demand 4.3 mmbopd
Natural Gas - 171 billion cubic feet
Natural gas storage is still about 690 billion cubic feet above the five year average.....
1/3 Oil - Statistics from the USA - 10.30 EST
I expect,
Crude + 2.0 mmbls
Gasoline + 1.0 mmbls
Distillates - 1.0 mmbls
Crude Import 10.1 mmbopd
Refineries 86.9%
Gasoline Demand 9.0 mmbopd
Distillate Demand 4.3 mmbopd
Natural Gas - 115 billion cubic feet
Natural gas storage is still about 690 billion cubic feet above the five year average.
The US has ample supply and following the pattern of the last weeks the Stats show one thing and
then comes some geopolitical event that sends the contracts into "risk-mode". Saudiarabia was not as bad as
it was made out to be and as far as Nigeria, Venezuela etc itīs pretty much business as usual from the
troublemakers. Venezuela as I have stated before is all hot air from the Fool on the Hill.
Somebody really should clean Chavezeīs Clock..
1/3 Price of Oil & Gas - Close 28/2
Nymex Crude Future 61.42 +0.41
IPE Crude Future 61.76 +0.77
Dated Brent Spot 58.87 +0.43
WTI Cushing Spot 61.25 +0.25
Minas 61.63 -1.05
OPEC 11 56.25 +0.15
Nymex Natural Gas 6.74 -0.07
24/2 Cairn Energy PLC UK - CNE:LSE - Looking for Oil in Nepal
Keeps on trucking...
24/2 Price of Oil & Gas - Close 23/2
Itīs the Spot prices for Brent and WTI you need to watch going forward.
And in this the Oil on direct demand/supply is the best reflection of the - Fundamentals.
Again itīs the Fundamentals!!
Dated Brent $57.75
WTI Cushing $58.29
24/2 WTI Front Month - A FishNetŪ Perspective - Daily & Weekly
23/2 Oil - Statistics from the USA - 10.30 EST
Crude + 1.1 mmbls
Gasoline + 0.1 mmbls
Distillates - 1.3 mmbls
Crude Import 10.0 mmbopd
Refineries 86.6%
Gasoline Demand 9.0 mmbopd
Distillate Demand 4.2 mmbopd
Natural Gas - 123 billion cubic feet
Well I was way off on the Crude and Product numbers... Again a build for Crude and the rest are hanging
around the zero change line. Irrespective of the prognosis the fact is that there are no great draw downs
in the storage numbers and the totals are above average. Itīs good that their is supply if needed yet
as with commodities they get themselvs into periods of imbalance and well.... The supply numbers should also
be seen in the context that refiners are about 7% below normal operating levels.
23/2 Lundin Petroleum LUPE:SAX - Financial Report
I usually do not comment or predict Financial Reports from LUPE as you inveriably come in on the
wrong side of the equation. Yet this matters very little as it is "Daily Production" that is the true
test of an oilers worth. As an Upstreamer ofcourse up and coming projects and success of initiated also
plays a great part yet it is oil out of the ground that is the yardstick.
As such I think the market place had too elevated expectations.. No matter it will all be forgotten
sooner rather than later and the stock will be back on track following and in some part leading the companies
production increase and exploration programme.
The 2006 exploration season is a damned interesting one.....
22/2 Oil - Statistics from the USA out on the 23/2
I expect,
Crude + 3.5 mmbls
Gasoline + 2.5 mmbls
Distillates + 1.5 mmbls
Crude Import 10.6 mmbopd
Refineries 86.9%
Gasoline Demand 8.8 mmbopd
Distillate Demand 4.1 mmbopd
Natural Gas - 95 billion cubic feet
Again the build across the board. Refinery output is the tricky one. The winter season is quickly
coming to an end without any real deep freeze. Colder weather expected during the coming week though.
22/2 Price of Oil & Gas - Close 21/2
Nymex Crude Future 61.10 +1.22
IPE Crude Future 61.60 +0.16
Dated Brent Spot 60.07 +0.11
WTI Cushing Spot 61.10 +1.22
Minas 61.09 +0.16
OPEC 11 56.25 +0.25
Nymex Natural Gas 7.73 +0.55
US Gasoline futures fell to a 3 month low... In after hours trading itīs down across the board.
21/2 The Price of Oil & Gas
Nigeria again is in the price structure.. An OPEC country that simply does not have a clue about
how to keep the oil flowing. If the world really was running out of oil today well then I suspect Nato,
USA, UK and perhaps the UN would be there in force. The troubles will reflect in the contracts and then
some yet it is just again - Nigeria.
What is more of interest is in the - The Mouse That Roared - category ie Venezuelas President Hugo Chávez,
The fool on the hill. CITGO is the Venezuelan Oil Company that has 1500 service stations in the
US yet the Fool is saying he will stop the flow of oil to the Northen Satan. Pure Prairie Shit I say!!
Hugo Chavez, President of Venezuela is playing the game and in this he has won some points in letting CITGO
deliver rebated heating oil to "poor" communities in the North Eastern states. A gesture from the revolution...
Itīs all media fluff. Venezuela is the US supplier and thatīs the fact.
This geopolitical happening will run itīs course and a 3% to 5% short term up-tick for WTI ainīt bad..
Get it if you can.
18/2 WTI Front Month - A FishNetŪ Perspective - Daily & Weekly
16/2 Lundin Petroleum LUPE:SAX - PL 338 Farm-in
Revus Energy ASA - OSE: REVUS has entered into an agreement with Lundin Petroleum
to acquire a 30% interest in PL 338 in block 16/1.
ExxonMobil has had an option to acquire a 30% interest in the licence, so what you have to wonder
is was this their 30%..... In any case an exploration drill is set for this year.
16/2 Cairn Energy PLC UK - CNE:LSE - Looking for Oil in Nepal
This is one for the books... Worth a goodly eye. And I am telling you about it again...
"19/4 Cairn Energy PLC UK CNE:LSE
This is one hot puppy!"
16/2 WTI Front Month - A FishNetŪ Perspective - Daily & Weekly
16/2 Price of Oil & Gas - Close 15/2
Nymex Crude Future 57.65 -1.92
IPE Crude Future 58.15 -1.37
Dated Brent Spot 56.19 -1.61
WTI Cushing Spot 57.75 -1.82
Minas 57.87 -0.96
OPEC 11 54.45 -0.85
Nymex Natural Gas 7.06 -0.68
15/2 Oil - Statistics from the USA
Crude + 4.9 mmbls
Gasoline + 2.2 mmbls
Distillates + 0.9 mmbls
Crude Import 10.3 mmbopd
Refineries 86.1%
Gasoline Demand 8.9 mmbopd
Distillate Demand 4.2 mmbopd
Well you have been warned about this....
15/2 Oil - Statistics from the USA
I expect,
Crude + 3.0 mmbls
Gasoline + 2.0 mmbls
Distillates - 0.0 mmbls
Crude Import 9.9 mmbopd
Refineries 86.2%
Gasoline Demand 8.5 mmbopd
Distillate Demand 4.1 mmbopd
Natural Gas - 60 billion cubic feet (corrected)
Ample storage and rising. The warmer than usual winter weather has meant that a lot of refiners
have opted for early work-overs. This will then be very important in the spring.
Again I am going to rain on the parade and say the price of Crude is heading down towards the
Fundamental levels earlier posted. How you make money in this market is your call....
A tip! Remember history or rather learn from it.... *G*
9/2 Price of Oil - Close 8/2
Nymex Crude Future 62.55 -0.54
IPE Crude Future 60.46 -0.93
Dated Brent Spot 60.33 -0.79
WTI Cushing Spot 62.95 -0.14
Minas 61.04 -1.49
OPEC 11 57.59 -0.83
Nymex Natural Gas 7.74 -0.12
8/2 Oil - Statistics from the USA
Crude - 0.3 mmbls
Gasoline + 4.3 mmbls
Distillates - 0.3 mmbls
Crude Import 9.9 mmbopd
Refineries 85.8%
Gasoline Demand 8.9 mmbopd
Distillate Demand 4.2 mmbopd
Natural Gas - 38 billion cubic feet (out 9/2)
The Refinery numbers again were less than expected yet this means that work-overs are still on the
cards and this should have effect during the spring. As we are heading into the Gasoline Season
that number is the central theme this week, again. Warmer than usual weather is not going to
deplete the Distillate stocks so itīs eyes on Gasoline.
Natural Gas futures fell 3% on this number which was way below most forecasts, not this sites though...
8/2 USA - EIA - Short-Term Energy Outlook
EIA - Short-Term Energy Outlook
Interesting reading as always.. Spend some time on the graphs.
8/2 Oil - Statistics from the USA
I expect,
Crude + 2.5 mmbls
Gasoline + 3.0 mmbls
Distillates - 1.0 mmbls
Crude Import 9.8 mmbopd
Refineries 88.0%
Gasoline Demand 8.7 mmbopd
Distillate Demand 4.1 mmbopd
Natural Gas - 30 billion cubic feet
Again a build in storage. Geopolitics are the driving force behind the contracts yet when
that fluff is taken out of the equation itīs Fundamentals - anyone remember that word?
Bush sayīs the US is an Oil Junkie well Hell the whole world is shooting up and there aint
nothing that we can do about it in a hurry anytime soon. Yet what the world can do is to stick
to the fundamentals! The world is not running out of Oil there is not one lone customer that
is not getting the oil he or she needīs.
$40 to $50 Oil is Fundamental! Everything else is money in the bank for us in the Oil Patch,
yet for the world at large and the global economy itīs bad very bad.
$40 to $50 Oil is Fundamental!
8/2 WTI Front Month - A FishNetŪ Perspective - Daily & Weekly
