Greywolf







Latest Postings



22/3 GMT 23.05 Oil - The Market - Contracts Contracts end up 3% on NYMEX and the cause.. The Fed perhaps on the easing rates trail, Hurricane Season in the Gulf expected to be worse than normal, Gasoline demand up and the whole conversion to summer blends technicals, demand from Refiners coming back online, and stock technicals.. Just one of those days. Not even a larger than expected Natural Gas number could hold this Bull back. So will it last well it all depends on all of the above and then the things we do not yet know like Iran etc. Based just on the US well then there is some justification to the climb but itīs mostly worry driven. US refiners have been running at about 10% below sustainable maximum output so that affects Gasoline and in this stocks of the product are not exactly low so look for a volatile period, with Gasoline the driver. I have one caution and that is that if the US economy is weak then a high commodity price structure is the last thing it needs. Itīs a fine line.. 22/3 GMT 14.30 Oil USA - Statistics from the DOE - API Natutal Gas increase + 17 Bcf. Fairly market neutral. Itīs the first increase for the season, in 17 weeks in fact... 22/3 GMT 12.51 Lundin Petroleum LUPE:SAX - Viking Oil & Gas - Updated For this deal to be more than just a good deal for Lupe certain criteria have to be met. This due to the fact that the "new" Lupe will be more about risk and exploration, back to the good old days.. The company will be for all intents virtually debt free and have a halved production from todays at about 20.000 boepd. The criteria then are primarily that Lagansky actually gets off the ground this year and in this I see no other possibility other than that a Russian partner is on the way. Perhaps most of this is already agreed on hence the Viking spin-off. Sudan is I have stated earlier the big question and in this with Lupe a minority owner very much in others hands. Ideal scenario would be test drills this year and then sell the stake because of the high risk in Sudan. Or retain the holding and hope that the new positive tones out of the South of Sudan can mean that production can come online and be assured security. New exploration blocks must be sought and as the company states South East Asia is a target. In this Indonesia have recently stated that it wants to increase production by 30% in the near future and then through easing local regulations on exploration licenses and environmental concerns. Vietnam is an interesting place and there are other likewise projects worth a look. Yet of prime importance is that Lagansky sees a drill bit in the ground soon... Yet and this is the sweetener Lupes share of Viking Oil & Gas is still as close to 50% as possible and there is I belive value in Viking Oil & Gas that will become apparent after the spin-off. Just the listing in Oslo alone is going to enhance value. This is simply a very good deal for all! 22/3 GMT 09.58 Lundin Petroleum LUPE:SAX - Viking Oil & Gas The spin-off is a brilliant concept and it not only adds value to the current company, Lupe, but it adds huge potential to both companies going forward. The key here is concentration and focus. Lupes assets have of late been hard for the market to judge as they have been possibly to diversified, this problem is now solved to as I see it major benefit to all. A leaner Lupe will be easier for the market in general to follow and Viking is set off on itīs own road with a well packed suitcase of assets. Also of prime importance is that as is the Lundin style shareholders are given a very good deal in the restructuring process. I expect to see a more vigorous activity going forward in Russia, Tunisia and Sudan even if the latter is the problem child. Yet with the White Nile WNL:LN experience in mind there is hope. 21/3 GMT 14.30 Oil USA - Statistics from the DOE - API Crude + 4.0 mmbls (API + 5.7 mmbls) Gasoline - 3.4 mmbls (API + 0.75 mmbls) Distillates - 1.7 mmbls (API - 0.17 mmbls) Crude Import 10.4 mmbopd Gasoline Imports 0.8 mmbopd Refineries 86.3% Gasoline Demand 9.2 mmbopd Distillate Demand 4.5 mmbopd Total Petroleum Inventories - 2.9 mmbls Gasoline is the driver. Note though that Refineries are in transition mode, yet Gasoline demand has been brisk of late. The increase in Crude stocks negates much of the Gasoline drop so a market neutral to slightly positive report. 21/3 GMT 12.56 Lundin Petroleum LUPE:SAX - Lagansky Please note the volume.. In this this please further note the earlier posting on 13/3. 20/3 GMT 18.36 Oil USA - Statistics from the DOE - API out 21/3 GMT 14.30 I expect, Crude + 1.7 mmbls Gasoline - 2.0 mmbls Distillates - 1.5 mmbls Natural Gas + 15 Bcf Crude Import 10.1 mmbopd Gasoline Imports 0.9 mmbopd Refineries 86.2% Gasoline Demand 9.2 mmbopd Distillate Demand 4.6 mmbopd Total Petroleum Inventories - 0.5 mmbls 16/3 GMT 11.05 Tanganyika Oil - TYK:TSX - TYKS:SAX - Syria Do not forget the potential of the Butmah and Kurachina structures... 15/3 GMT 17.09 Canmex Minerals Corporation - CXM.V Canmex Minerals Corp. has agreed to sell, on a non-brokered, private placement basis, up to a total of four million common shares of the company at a price of $5 per share for gross proceeds of up to $20-million. Net proceeds of the private placement will be used toward the company's proposed work program on the Nogal and Dharoor oil exploration projects in Puntland, Somalia, as well as for general working capital purposes. 15/3 GMT 14.30 Oil USA - Statistics from the DOE - API Natutal Gas draw - 115 Bcf. Fairly market neutral. Going in to the spring period Natural Gas storage is still 12% above average. 15/3 GMT 10.57 Range Resources - RRS:ASX - Somalia Range and Canmex have now completed the 80% farmin of the Puntland site. This gives Range US$50 million. 14/3 GMT 14.30 Oil USA - Statistics from the DOE - API Crude + 1.1 mmbls (API + 6.3 mmbls) Gasoline - 2.5 mmbls (API - 0.5 mmbls) Distillates - 2.8 mmbls (API - 4.3 mmbls) Crude Import 9.8 mmbopd Gasoline Imports 0.9 mmbopd Refineries 85.6% Gasoline Demand 9.2 mmbopd Distillate Demand 4.7 mmbopd Total Petroleum Inventories - 2.6 mmbls A market neutral to negative report. 14/3 GMT 14.05 Tanganyika Oil - TYK:TSX - TYKS:SAX - Updated At 114 to 116 Riksdaler this stock is not a Strong Buy itīs a Steal! On my investment horizon this stock is the only "falling knife" I am buying at this time. Like taking candy from a baby... It should be said that I usually do not rant and rave about a singular stock but when it comes to TYK I feel compelled to as the valuation of this company is just simply wrong. I remember when TYKS was still in Tanzania and the stock hit 12 Toonies ie C$12 on pure speculation that was then about 65 Riksdaler and this then in the middle of the 90īs. That valuation was crazy, lucrative but crazy. Todays valuation is just simply wrong. 13/3 GMT 21.35 White Nile WNL:LN - Sudan White Nile oil deal a revolution for Africa The unabated exploitation of Africa’s natural resources may soon be a thing of the past if events in Southern Sudan are anything to go by. A deal signed between The government of Southern Sudan and a British company —White Nile Ltd — may just put paid to wanton exploitation of natural resources by unscrupulous multinationals. Under the agreement, White Nile has committed itself to minimum environmental standards and to support community development projects. White Nile struck a deal to explore and drill for oil in Block Ba with the government of South Sudan in February 2005. In the deal, GOSS, through its state-owned petroleum company Nile Petroleum Corp (Nile Pet), transferred a 60 per cent interest in Block Ba to White Nile in return for a 50 per cent equity stake in the company. The government’s shareholding in Nile Pet is currently valued at $385 million. 13/3 GMT 19.41 Again - Thank You Dr Greenspan! Thanks Mate for the Heads Up! The US Housing market is scary monsters and the retail numbers - an early indicator of what the good Doctor warned about... 13/3 GMT 19.30 Oil USA - Statistics from the DOE - API out 14/3 GMT 14.30!! I expect, Crude - 2.0 mmbls Gasoline - 2.5 mmbls Distillates - 2.5 mmbls Natural Gas - 90 Bcf Crude Import 8.3 mmbopd Gasoline Imports 0.6 mmbopd Refineries 85.8% Gasoline Demand 9.1 mmbopd Distillate Demand 4.6 mmbopd Total Petroleum Inventories - 12.0 mmbls Fog has on and off delayed shipping in the Houston Ship Channel over the last few weeks hence I see Imports weak at the same time a number of the larger Refiners are coming back on line and have done so which makes this week hard to call. I would not be surprised to be surprised by numbers that are way off the expected path... 13/3 GMT 12.38 OPEC - DOE/API A heavy week for oil with OPECīs meeting on Thursday expected to leave well enough alone. The DOE/API stats from the US will be interesting as we are in deep transition mode between a warmer than usual winter and what is expected to be a warmer than usual spring. Refiners that have been off-line due to work overs are coming back.. My expectations on the stats will be posted later during the day. In this please note that the Houston Ship Channel has been closed during the weekend and has just been closed again today due to fog. I would point out that the 81 km long Houston Ship Channel is the waterway along which 5 large refineries are situated with a total daily production of about 1.3 mmbopd... 13/3 GMT 01.32 Lundin Petroleum LUPE:SAX - Lagansky The Russian Environmental Agency RosPrirodNadzor is the culprit when it comes to the ridiculous demands placed on foreign oil companies in Russia and Lupe got a taste of it last year. To actually get this project off the ground or off the bottom of a very shallow sea as it where. I see a Russian partner a comin over the mountain... 12/3 GMT 21.30 Tanganyika Oil - TYK:TSX - TYKS:SAX The stocks valuation today is just Silly. In this "silly" is a stock trading technical term.. *g* If you look at the trade over the last few months, well longer than that there are a few big fish snapping up this stock net on the sly. Salomon Brothers ie Citigroup are one shining example. In this I have to reiterate this company only has 57 million and change shares emitted. Usually small upstreamers that come to this point ie they hit the big one have somewhere between 100 and 200 million shares emitted. Ofcourse the valuation is relative to the number of shares etc, but this company which has an oil reserve larger than many in the class and the class above is today valued at a Silly level. 12/3 GMT 21.10 Site Updates Been off-line, hence low rate of updates, hence no updates.. 9/3 GMT 13.55 USA - Daylight Saving - Oil Demand On Sunday the US goes into Daylight Saving mode three weeks earlier than before, all part of an energy saving plan hatched out in 2005. The funny thing is that this may lead to greater energy consumption especially when it comes to Gasoline as the days are longer, well not longer as such but the active period of the day is longer ie after work hours there is more daylight which leads to more driving etc.. Only the stats going forward will show if this is correct ofcourse. 9/3 GMT 09.42 China - Oil Demand - Updated China's oil imports may rise 10% this year, a slower pace than last year's 14%, as government policies to boost energy conservation cuts fuel consumption. Crude imports may reach 160 million tons, about 3.2 million barrels a day from last year's 145 million tons, China Petrochemical Corp., the nation's largest oil refiner, said today in its online newsletter Sinopecnews. China's crude imports climbed 3.5% in 2005 and 34.8% in 2004, according to customs data... The world's second biggest energy user is closing inefficient plants and penalizing polluting power generators after missing a 2006 target to cut the amount of energy used for each unit of gross domestic product by 4%. China is boosting the use of renewable resources such as biomass to further reduce its reliance on overseas oil. Also Chinas manufacturing economy canīt afford to pay high energy prices if they want to produce the buckets, shoes, tshirts, DVDīs etc that the rest of the world is getting used to buying - cheap. More on this.... 9/3 GMT 08.27 Tanganyika Oil - TYK:TSX - TYKS:SAX - Gary Guidry So? Everyone feel better now? Mr Guidry bought 160.000 Common Shares by way of exercising his options all of this registered on 8/3.. Mr Guidry now owns 160.000 shares in the company and retains no options. This not to say that I am sure he will be offered options in the future as is the Lundin way. Nice little divestment, investment Mr Guidry!! 8/3 GMT 21.55 China - Oil Demand - Updated 1993 2.5 mmbopd 1994 3.0 mmbopd 1995 3.3 mmbopd 1996 3.5 mmbopd 1997 4.0 mmbopd 1998 4.5 mmbopd 1999 4.6 mmbopd 2000 4.7 mmbopd 2001 4.8 mmbopd 2002 5.0 mmbopd 2003 5.3 mmbopd 2004 6.6 mmbopd 2005 6.4 mmbopd 2006 6.9 mmbopd? Chinas Ma Kai, the minister in charge of the cabinet-level National Development and Reform Commission stated on 7/3 that China had imported 1.1 billion barrels of oil in 2006. China currently imports 47% of itīs demand needs... This then brings us back to the earlier statement made by the Chinese in January (please see earlier postings) that Chinas oil demand in 2006 would be just over 2 billion barrels... More on this... In the meanwhile do the numbers.. 8/3 GMT 16.34 Tanganyika Oil - TYK:TSX - TYKS:SAX Interesting trade after the FIīs Insider list was published. CEO Gary Guidryīs divestment, investment caused some weird trade.. The man earns but $240.000 a year in salary plus options. Whatīs the big deal. I am sure it will all feel better in the morning... 8/3 GMT 15.30 Oil USA - Statistics from the DOE - API Natural Gas draw - 102 Bcf, in line with my expectations but maybe not the market at large. Neutral to negative report. 8/3 GMT 10.22 Tanganyika Oil - TYK:TSX - TYKS:SAX Öhman Equities have put out an analysis of the company with the following salient points, Öhman Equities TYKS - TYK - STRONG BUY, target price SEK 185 (130). Analyst: Joakim Kindahl * DeGolyer & MacNaughton reports 2P reserves for the company of 778.6 mmbbl, with 767.6 mmbbl in Syria and 10.9 mmbbl in Egypt. This is up from 118.3 mmbbl (115.2 mmbbl in Syria and 3.1 mmbbl in Egypt) a year ago. * Egypt now has estimated reserves of close to 11 mmbbl - up from around 3 mmbbl a year ago. We argue that the majority of the potential is now taken in Egypt and the value should be around or even in excess of our estimated USD 50-70m.1 These funds could be used better in the Syrian development, something that will require a lot of capex to bring up to peak production. * At today's market valuation, the company is trading below USD 1.3 per bbl, something that we consider unjustified. The valuation per barrel in the ground today should be in the area of around USD 3 per bbl, which gives good upside from today's levels. * We raise our target price to SEK 185 from our previous target of SEK 130 and continue to rate the stock a STRONG BUY. We see further potential in the share when triggers materialize i.e. more rigs signed up, production increases. It may be worth noting that the analyst in question used to work for Lundin Petroleum as an oil analyst.. Hence he should know his way around the Lundin companies rather well.. You ofcourse know my feelings about this one already. 7/3 GMT 15.30 Oil USA - Statistics from the DOE - API Crude - 4.8 mmbls (API - 6.6 mmbls) Gasoline - 3.8 mmbls (API - 7.4 mmbls) Distillates - 1.3 mmbls (API - 0.9 mmbls) Crude Import 8.9 mmbopd Gasoline Imports 0.8 mmbopd Refineries 85.8% Gasoline Demand 9.1 mmbopd Distillate Demand 4.7 mmbopd Total Petroleum Inventories - 15.8 mmbls A market positive report. The demand numbers for both Gasoline and Distillates have been above last years level and this toghether with early Refinery work-overs depletes the storage volumes. Low imports are not a reflection of the producer reductions. Gasoline is the driver here.. Check the API numbers. Yet these kinds of surprise reports do occur especially in transition periods between winter och summer conditions. Problems with shipping logistics at Houston Ship Channel took 0.65 mmbopd off the import market. 7/3 GMT 12.45 The Death of the Peak Oil Theory.. In a wide-ranging study published in 2000, the U.S. Geological Survey estimated that ultimately recoverable resources of conventional oil totaled about 3.3 trillion barrels, of which a third has already been produced. More recently, Cambridge Energy Research Associates, an energy consultant, estimated that the total base of recoverable oil was 4.8 trillion barrels. That higher estimate — which Cambridge Energy says is likely to grow — reflects how new technology can tap into more resources. There is still a minority view, held largely by a small band of retired petroleum geologists and some members of Congress, that oil production has peaked, but the theory has been fading... See my earlier posting on Digital Oil and the technology that can greatly enhance oil extraction.. 7/3 GMT 11.43 The Market The US Futures have been falling and the US looks set to open down this after a negative close on Nikkei and Hang Seng.. 7/3 GMT 11.15 Tanganyika Oil - TYK:TSX - TYKS:SAX The company intendes to grow organically yet a bid on part or the whole company is not off the table. It never has been as the Lundins have made it very clear that anything is for sale at the right price. In this the fact that Staumur-Burdaras decreased their holdings from 10.4% to 8.5% give the Lundins sole control over the proceedings. The Staumur-Burdaras decision suggests not perhaps that a deal is imminent but it does give the company free hands to act rather quickly if something should come along... My own thoughts on this are that Staumur-Burdaras did the right thing at an early stage and they want to make money just like everyone else. They did not relinquish their corner just for the hell of it. I would not be surprised to see some sort of a deal sooner rather than later. 6/3 GMT 15.10 The Market So do we belive the upturn? I am going to let this go for a few days before getting back in a serious way. A US stock market that is driven by $/Ĩ trade and the words from Fed governors just aint enough to float my boat. I would trade this market very short and I have a feeling we may see further downturn simply because the negatives are still out there. 5/3 GMT 18.27 Oil USA - Statistics from the DOE - API out 7/3 GMT 15.30 I expect, Crude + 2.0 mmbls Gasoline - 0.9 mmbls Distillates - 2.2 mmbls Natural Gas - 100 Bcf Crude Import 9.5 mmbopd Gasoline Imports 0.9 mmbopd Refineries 85.7% Gasoline Demand 9.1 mmbopd Distillate Demand 4.6 mmbopd Total Petroleum Inventories - 7.0 mmbls With Gasoline demand about 3% above last year this is the one to watch going forward as Distillates and Natural Gas lessen their influence on the Crude contracts. Itīs more and more about Gasoline and the Refinery numbers. With the warmer winter period refiners have started work overs and Gasoline grade conversions a bit earlier and this will show up in the stats going forward. 5/3 GMT 12.36 USA- Dow Jones Wilshire 5000 Composite Index - INDEX:DWC How far can we go? Well 13.500 looks like a target yet it could test the lows of 2006. And ofcourse the VIX Index, 5/3 GMT 10.36 Thank You Dr Greenspan! He may not be the head of the Fed but he still can speak the speak and talk the talk. I for one closed all short term positions as soon as Dr Greenspan spoke. Given the markets I for one will not get back in for quite a while. As always in corrections like these the long holdings are unaffected because this will blow over, yet I belive it may be bloodier than most expect. Yet the sunshine part of the story is that there are huge amounts of cash on the sideline as this correction has been coming for a long while, all it needed was a primer. Again Thank You Dr Greenspan... 4/3 GMT 14.45 Climate Change - The Hype Al Gore wins an Oscar.. What the hell is that all about? The UN is to publish a Climate report in May that makes humans the original sinners, again. Are you like I am tired of the hype and for a large part the direct lies. Here is another view, To be fair and balanced, below is the abreviated IPCC Report that later will be published in May by the UN. Where it states that if only humans where eradicated from the planet all would be well... Or something along that line... 1/3 GMT 15.30 Oil USA - Statistics from the DOE - API Natural Gas draw - 132 Bcf. This then less than expected. A neutral to negative report. 28/2 GMT 15.30 Oil USA - Statistics from the DOE - API Crude + 1.4 mmbls (API + 1.0 mmbls) Gasoline - 1.9 mmbls (API - 0.8 mmbls) Distillates - 3.8 mmbls (API - 2.5 mmbls) Crude Import 9.5 mmbopd Gasoline Imports 0.9 mmbopd Refineries 86.0% Gasoline Demand 9.1 mmbopd Distillate Demand 4.7 mmbopd Total Petroleum Inventories - 8.9 mmbls 28/2 GMT 10.57 China - Sinopec - Gas Discovery I wrote about this one as did everyone in the whole oil sector in April of 2006. The Puguang gas field in the Northwestern province of Sichuan, discovered early last year by China Petroleum & Chemical Corp, Sinopec, may now have proven reserves of 500-550 billion cubic meters by 2008, said the Xinhua News Agency, compared with 251 billion cubic meters last year. The estimate of the reserve is still to be independently proven but if true then China has gained a huge resource of clean fuel. And this then of no little importance when it comes to evaluating Chinas energy demand... 28/2 GMT 08.31 Tanganyika Oil - TYK:TSX - TYKS:SAX - 2006 Q4 Report - Updated It costīs Money to make Money... The Q4/AR Report is what it is and it was never expected to be that good anyway. Itīs what is ahead that is important. The company has a bankable Reserve Evaluation, "the paper" that is worth a hell of a lot more than the financial report for the year gone by. TYK is an Upstreamer and it costīs money to explore for oil, just a simple fact. TYKS have found oil and also has production given small but itīs production. The real asset is "the paper"... Also the day is far from over. A thought about Staumur-Burdaras and the fact that they have decreased their ownership in the company from 10.4% to todays 8.5% would be that their corner was somewhat of a poison pill... 28/2 GMT 02.05 Tanganyika Oil - TYK:TSX - TYKS:SAX - 2006 Q4 Report TYKS has 57.730.196 fully diluted shares emitted. This in itself is a huge strength as there are companies out there with far lesser resources but far more many owners. TYK is going to need capital to fully realise the potential of itīs reserves ofcourse but it does so from a position of far greater strength than many others in the sector. As stated the report of how it was is one thing, itīs the presentation of how it is going to be that is the one to watch!! 27/2 GMT 23.21 Tanganyika Oil - TYK:TSX - TYKS:SAX - 2006 Q4 Report The Q4 Report will be released before trade in Stockholm and the conference call is at 1700 CET or 0800 Vancouver time. Just to clarify the situation. As if it needed clarification... 27/2 GMT 17.47 Oil USA - Statistics from the DOE - API GMT 15.30 28/2 I expect, Crude + 3.5 mmbls Gasoline + 0.3 mmbls Distillates - 3.5 mmbls Natural Gas - 140 Bcf Crude Import 10.0 mmbopd Gasoline Imports 0.7 mmbopd Refineries 85.9% Gasoline Demand 9.1 mmbopd Distillate Demand 4.6 mmbopd Total Petroleum Inventories - 10.5 mmbls 27/2 GMT 11.36 China - Dr Greenspan In light of the fall on Chinese markets with the China Shang Composite down - 8.1% and China Shenz Composite down - 7.7%. It may be well to point out that it is 10 years this year since the Asian Crisis... Also I for one listen very intently to the words of Dr Greenspan. Chinas economy is fragile as it is mainly built around the concept of "producing for others" ie China is the worlds workshop. In this a staggering 10% to 12% of GDP is made up of the counterfeit trade so if you bought a Rolex for a hundred bucks it most probably came from China. Interesting times.. 27/2 GMT 08.29 Tanganyika Oil - TYK:TSX - TYKS:SAX - Report The Reserve Report was the first part of a two part process. The company comes out with itīs Report on the 28/2. With comments and thoughts regarding what to do going forward. Donīt forget this salient point. 26/2 GMT 22.02 Tanganyika Oil - TYK:TSX - TYKS:SAX - Syria Syria proven plus probable reserves, net to the Company, increased from 41 to 416 million barrels. A resource potential of 14 billion barrels STOOIP. *G* Big Happy!! 25/2 GMT 22.55 Tanganyika Oil - TYK:TSX - TYKS:SAX - Syria Syrias current production of light crude is dropping due to few new exploration projects. In this there is a concession round of offshore oil sites coming up. Interestingly Syria today has a Heavy Oil production of about 200.000 mbopd and the Syrian Petroleum Company wants to increase this production to 275.000 mbopd going forward. The increase will come mainly from oil fields run by international oil firms... Based on todays data Syria is expected to have a capacity to produce around 325.000 mbopd of Heavy Oil until 2025. Based on data available today... Syria is currently holding talks with Kuwait's Noor Financial Investment Company to lead an Arab/European investment consortium to establish a 140.000 mbopd oil refinery in country. As of today there are only 13 foreign companies working to explore oil in Syria in addition to two companies working to develop some old fields as to increase their productivity... 23/2 GMT 22.40 Iran - US Military Strike Cheney hints at Iran strike US Vice-President Dick Cheney has raised the possibility of military action to stop Iran acquiring nuclear weapons. He has endorsed Republican senator John McCain's proposition that the only thing worse than a military confrontation with Iran would be a nuclear-armed Iran. In an exclusive interview with The Weekend Australian, Mr Cheney said: "I would guess that John McCain and I are pretty close to agreement." The visiting Vice-President said that he had no doubt Iran was striving to enrich uranium to the point where they could make nuclear weapons. He accused Iranian President Mahmoud Ahmadinejad of espousing an "apocalyptic philosophy" and making "threatening noises about Israel and the US and others". He also said Iran was a sponsor of terrorism, especially through Hezbollah. However, the US did not believe Iran possessed any nuclear weapons as yet. "You get various estimates of where the point of no return is," Mr Cheney said, identifying nuclear terrorism as the greatest threat to the world. "Is it when they possess weapons or does it come sooner, when they have mastered the technology but perhaps not yet produced fissile material for weapons?" - http://www.theaustralian.news.com.au 22/2 GMT 23.05 Oil - VLCC Freight Rates As stated before seasonal lows, but the shipping sector thinks we could be at a bottom level even if there is more supply than demand in the Middle East at the moment. Week by week... OPEC have in this signalled no more cuts and as the weather in the Northen Hemisphere warms up.. Higher lows since 2002. 22/2 GMT 22.31 Iran - UN Sanctions - IAEA The five permanent members of the UN Security Council will meet in London on Monday 26/2 to begin drafting a new resolution on further sanctions against Iran. 22/2 GMT 15.30 Oil USA - Statistics from the DOE - API Crude + 3.7 mmbls (API na mmbls) Gasoline - 3.1 mmbls (API na mmbls) Distillates - 5.0 mmbls (API na mmbls) Natural Gas - 223 Bcf Crude Import 9.7 mmbopd Gasoline Imports 0.5 mmbopd Refineries 85.2% - 1.4% Gasoline Demand 9.1 mmbopd Distillate Demand 4.7 mmbopd Total Petroleum Inventories - 11.1 mmbls This one will be put a cat amongst the pidgeons... The lower Gasoline numbers are due to the lower Refinery Runs as demand has been steady. Despite low Imports Crude gained again due to Refiners. The Natural Gas draw was pretty much inline with expectations. A market neutral to positive report. 22/2 GMT 08.56 Iran - 60 day deadline come and gone There is no sign of Iran backing down on banned uranium enrichment in face of a negative nuclear watchdog report and a US Navy buildup, quite the opposite Iran seems intent on accelerating its enrichment program. IAEA nuclear watchdog director Mohammed ElBaradei reported Wednesday to the UN Secretary that Iran had not only missed the 60 day deadline for suspending uranium enrichment but had accelerated the process. Iran's president signaled Wednesday that he has no intention of meeting the United Nations' upcoming deadline to halt its uranium enrichment program and risks facing further sanctions. "Iran will not retreat one iota in its path to nuclear victory," Mahmoud Ahmadinejad said in a speech, according to Iran's state-run news agency IRNA. Iran has over the last year placed most of its war games in the area of the Straits of Hormuz... 21/2 GMT 15.45 Greywolf.Se in your Mobile Phone Time sensitive posts will be put on a very low graphics page that can be read in your mobile. The information will be brief. Please bookmark www.greywolf.se/mobile.html in your mobile phone. 21/2 GMT 15.25 Oil USA - Statistics from the DOE - API out 22/2 GMT 15.30 I expect, Crude + 2.0 mmbls Gasoline + 1.5 mmbls Distillates - 3.0 mmbls Natural Gas - 240 Bcf Crude Import 9.8 mmbopd Gasoline Imports 1.0 mmbopd Refineries 86.7% Gasoline Demand 9.1 mmbopd Distillate Demand 4.5 mmbopd Total Petroleum Inventories - 8.0 mmbls So is this one of the last weeks we see a winter report? Looks like it if you can go by what the weather people predict, warmer weather just around the corner. Transition periods like this are always harder to call as consumers can hold off on Heating Oil as itīs soon to get warmer etc. Please note that the "Winter Numbers" ie Distillates and Natural Gas this week come out at the same time. Can affect the contracts more than usual. On a side note the DOE is in March to start filling the existing SPR up to itīs current level of max capacity ie 727 mmbls, this then done in increments of 50.000 bopd from todays level of 690 mmbls. 21/2 GMT 13.20 Lundin Petroleum LUPE:SAX - Year End Report 2006 Well we knew 2006 was not going to be a stellar year, as it was a problem filled year for the company. Yet! Do the Lundins loose heart and hang their heads? I think not. The company has had "off years" before and cruised through to new ventures and successes as they are now doing. Many new prospects in interesting places are on the dance card and daily production is good, could be better but it will be sooner than later. With the stock trading around the 70 Riksdaler level it seems to have found a short term point of balance. It should be said that anyone who traded the stock during 2006 has had little to complain about and itīs just a matter of looking forward. Lotīs of interesting bits coming up this year... I have an Accumulate on this one. 21/2 GMT 13.11 Somalia - CXM:V - RRS:ASX The African Union is to send troops into Somalia in April and the UN will after evaluation follow within six months. The amount of troops is till undecided but it seems intially the AU will send 4.000 men. 20/2 GMT 23.29 Oil USA - Statistics from the DOE - API out 22/2 GMT 15.30 My expectations of Thursdays stats will be posted 21/2. The stats are one day late due to the Presidents Day Holiday. 20/2 GMT 19.08 Lundin Petroleum LUPE:SAX - Year End Report 2006 Lundin Petroleum's Year-End Report 2006. The presentation starts February 21, 2007 at 08.00 CET - GMT 07.00. 20/2 GMT 01.09 Iran - US 5th Fleet - Arabian Gulf The Aircraft Carrier Group with the USS Stennis is only days away from joining up with the USS Dwight D. Eisenhower in the US 5th Fleet area of operations which puts more air fire power off the Arabian Peninsula than most countries can muster. 20/2 GMT 00.55 Oil - The Contracts It looks like the oil price for 2007 will hang in the $50īs if not lower all depending on... Just fill in the blank space! In the short term winter is pretty much over in the US and Europe is warming up aswell. The storage situation in the US is ample and things are gearing up for the Summer. Iran is an issue as is North Korea and Nigeria which is sinking fast into a quagmire of problems. Yet the world is well supplied with oil and seems to be so for the foreseeable future. 20/2 GMT 00.22 Canmex Minerals Corporation - CXM.V - Range Resources - RRS:ASX - Somalia Again a new 12 month high for CXM, on terrible volume so pretty much disregard yet stay with this one... RRS is holding at $AUS 0.03.. 20/2 GMT 00.19 IRAQ - Western Desert I wrote in 2005, "20/7 IRAQ - Western Desert There are interesting "Oil Fields" in Iraqīs Western Desert....." As expected there are interesting things in Western Iraq close to Syria.. KARABILA, Iraq 19/2 -- In a remote patch of the Anbar desert just 20 miles from the Syrian border, a single blue pillar of flanges and valves sits atop an enormous deposit of oil and natural gas that would be routine in this petroleum-rich country except for one fact: This is Sunni territory. Huge petroleum deposits have long been known in Iraq's Kurdish north and Shiite south. But now, Iraq has substantially increased its estimates of the amount of oil and natural gas in deposits on Sunni lands after quietly paying foreign oil companies tens of millions of dollars over the past two years to re-examine old seismic data across the country and retrain Iraqi petroleum engineers.... http://www.iht.com/articles/2007/02/19/africa/web.02.php 19/2 GMT 13.12 Obducat - OBDU B:NGM Having read the Year end report and again taken all things into consideration... Well you know what I think about the stock.. The report itself was as you can expect from a company heavily into the development stage of evolution yet it does seem that there is a new phase initiated. Financing is ofcourse at this level always an issue but even there a change seems apparent. That the stock hung around the 2― Riksdaler level even after the report says a lot. The Japanese do not do things lightly and with Canon making a statement well you have to belive that 2007 is going to continue in the way it started ie different from before. How different is the interesting bit. 19/2 GMT 13.07 Tanganyika Oil - TYK:TSX - TYKS:SAX - Syria We are coming up on the Reserve Evaluation... *G* Big Happy!!... 15/2 GMT 21.51 Oil - VLCC Freight Rates Seasonal move down from less lofty highs though. Low activity in the VLCC sector through March, at least. 15/2 GMT 21.24 Obducat - OBDU B:NGM February 16th, 2007 Year-end Report, 1 January 2006 – 31 December 2006 15/2 GMT 20.42 Canmex Minerals Corporation - CXM:V - Range Resources - RRS:ASX - Somalia CXM breaks through the 12 month high level on for this stock, well lets call it volume. $5.05 new 12 month high. A graph of Range Resources travails. This is a copy of the ASX announcement.. 15/2 GMT 15.30 Oil USA - Statistics from the DOE - API Natural Gas draw - 259 bcf. This then against what I expected - 245 bcf. With warmer weather on the way next week this draw was not big enough to be especially bullish. The draw last year was - 92 bcf and the five-year average decline of- 149 bcf are far below these numbers but storage is still way above both last year and the five-year average. A market neutral to negative report. 15/2 GMT 12.21 China - Oil Demand - Updated 1993 2.5 mmbopd 1994 3.0 mmbopd 1995 3.3 mmbopd 1996 3.5 mmbopd 1997 4.0 mmbopd 1998 4.5 mmbopd 1999 4.6 mmbopd 2000 4.7 mmbopd 2001 4.8 mmbopd 2002 5.0 mmbopd 2003 5.3 mmbopd 2004 6.6 mmbopd 2005 6.4 mmbopd 2006 6.9 mmbopd Please see earlier postings from 9/1-14/1.. Shanghai Securities News reported, citing data from the Ministry of Commerce that Chinas net import of crude oil was at 138.84 mln tons, up 16.9% in 2006. China's domestic crude output rose a mere 1.7% to 183.68 mln tons in 2006. So what about my list... Well until revised I will leave it as it now stands. In this it should be pointed out that to get actual statistics from China is difficult but I have decided to go with theses numbers. Many have estimated that Chinas oil demand for 2006 would be 7.5 mmbopd, and as it seems it was not. I did earlier write that I thought the demand could be as high as 6.5 mmbopd as I have never really belived the 7.5 mmbopd estimate, simply the numbers on the ground did not add up. Yet caution is called for as the 2005 demand numbers were revised down by official agencies in March of 2006. Also from the 10/1 .. As stated a report out on Tuesday 9/1 of this year from Xinhua News Agency ie State News says that total oil demand in 2006 is estimated at just over 2 billion barrels.. Further I would point to China Petroleum and Chemical Industry Association - CPCIA, China's major petroleum industry association who in late 2005 predicted that Chinas oil demand in 2006 would be 300 mln tons ie 6.5 mmbopd and that it further predicted that Chinas demand would grow to 330 mln ton ie 7.2 mmbopd by 2010... 14/2 GMT 15.53 Lundin Petroleum LUPE:SAX - New Block in Vietnam The company has along with Pearl Energy and Serica Energy Corporation been awarded Block 06/94 Nam Con Son Basin. Each of the companies own a 33.3% share of the project. Block 06/94 covers over 4,100 over square kilometres in the Nam Con Son Basin to the south of Vietnam's continental shelf. The partners according to the contract have committed to investing US $49.3 million in processing 2D and 3D seismic data and drilling three wells in the first three years of exploration. 14/2 GMT 15.30 Oil USA - Statistics from the DOE - API Crude - 0.6 mmbls (API - 3.4 mmbls) Gasoline - 2.0 mmbls (API - 0.6 mmbls) Distillates - 3.0 mmbls (API - 0.3 mmbls) Crude Import 9.6 mmbopd Gasoline Imports 0.8 mmbopd Refineries 86.6% Gasoline Demand 9.1 mmbopd Distillate Demand 4.5 mmbopd Total Petroleum Inventories - 11.3 mmbls Less than expected decline for the Distillates at a time when winter has made itself felt over large parts of the US North East and in this winter is running out of time. Yet the colder weather did impact Distillates enough. Lower Refinery runs due to early start of work overs etc. Imports on par. The one that surprised is Gasoline yet with Refiners backing off it is a result that you can attribute. Thursdays Natural Gas draw will in this be important. Note the very low draw of Distillates in the API report. A market neutral to negative report. 13/2 GMT 20.42 Tanganyika Oil - TYK:TSX - TYKS:SAX New listing from the 14/2 on the Mid Cap segment of SAX. 12/2 GMT 19.47 Oil USA - Statistics from the DOE - API 14/2 GMT 15.30 I expect, Crude - 1.5 mmbls Gasoline + 2.5 mmbls Distillates - 5.0 mmbls Natural Gas - 245 bcf Crude Import 9.5 mmbopd Gasoline Imports 1.0 mmbopd Refineries 87.0% Gasoline Demand 9.1 mmbopd Distillate Demand 4.3 mmbopd Total Petroleum Inventories - 12.0 mmbls 12/2 GMT 19.35 White Nile WNL:LN - Sudan French oil major Total SA could consider giving the Southern Sudan government a stake in an exploration permit the company is claiming there, in order to oust White Nile Ltd. and start exploring a promising area according to a Total executive. Last week, the Court of Appeal in London granted Total the right to get White Nile to unveil documents, in a pre-action disclosure proceeding ahead of a potential legal suit against White Nile, Lassalle said. Total has asked to see documents answering questions such as when the directors of White Nile first made contact with the Southern Sudaneseleadership, with whom the directors had contact, what was the nature and the scope of discussions and proposal, and whether the directors had prior knowledge of Total's rights to the field. 12/2 GMT 14.24 Lundin Petroleum LUPE:SAX - Lagansky - E.Mor-4 The E.Mor-4 test well was drilled in the early 1980's and tested 445 boepd. Much earlier in the 1960īs a well was drilled, close to what became the E.Mor-4 site it was however not tested but proved oil finds in the Jurassic sands strata. Both wells were drilled approx 8 km west of the structure culmination. So we have two test drills and oil shows in both.... In this it could be of interest to repost the Degolyer & MacNaughton study from 31 Dec, 2005... And the Management Circular... 10/2 GMT 22.27 Lundin Petroleum LUPE:SAX - Sudan Indonesian Pertamina is looking for oil and gas blocks in Sudan.. More later... 8/2 GMT 12.48 Obducat - OBDU B:NGM Having taken all things into consideration this stock is now designated - A Strong Buy. 8/2 GMT 11.45 Obducat - OBDU B:NGM A stock I have been accumulating for a long time... For very good reason, and the first part of the reason came in today. Canon Marketing Japan (President : Haruo Murase) is pleased to announce that it has signed an exclusive distribution agreement with Obducat (CEO : Patrik Lundstrom). The agreement gives CMJ the exclusive rights to sell Obducat’s Nano Imprint Lithography equipment in Japan. Canon Marketing Japan will start marketing the equipment from March 1st, 2007 and enter into the new marketplace of nanoimprint equipment. 7/2 GMT 15.30 Oil USA - Statistics from the DOE - API Natural Gas draw -224 bcf.. A market neutral to negative report. I have corrected the first report status. The draw was within the market margins and for the cold weather to really have an affect on prices both Distillates and Natural Gas have to see larger than draws going forward. Another two weeks of cold weather say the weather service and that is not much in the scheme of things.. 8/2 GMT 10.28 OPEC - Iran - Ship Storage Iran is currently storing about 14 mmbls of Crude in seven VLCCīs on moorings off Kharg Island. Up until recently ten VLCCīs had stored about 20 mmbls but 3 mmbls have of late been released on to the market. In general there is a build up of tankers for crude storage in the gulf and Iran for its part stores crude rather than lower production this then as a part of the OPEC reductions... 8/2 GMT 09.54 USA - Oil Import - BP Prudhoe Bay - Posting To be Corrected Disregard earlier post. 7/2 GMT 21.46 Oil USA - Statistics from the DOE - API out 8/2 GMT 15.30 I expect, A Natural Gas draw of -210 bcf.. 7/2 GMT 21.44 Iran - US military strike - Update Iran's top security official, Ali Larijani, said Wednesday he would hold negotiations with Western officials over the country's controversial nuclear program during a security conference in Germany this weekend. His comments suggested Iran may be on a new diplomatic offensive in efforts to stave off sterner measures from the UN Security Council, should it fail to meet a 60-day deadline to suspend uranium enrichment that was imposed Dec. 23. "On the sidelines of the Munich conference, there will be some negotiations with Western parties," Larijani was quoted as saying by Iran's official IRNA news agency.... 7/2 GMT 19.21 Oil - The Contracts After a third attempt at $60 without success the WTI price will fall back. Despite a fairly positive DOE/API report and other geopolitical factors the technicals take overhand. 7/2 GMT 15.30 Oil USA - Statistics from the DOE - API Crude - 0.4 mmbls (API + 1.5 mmbls) Gasoline + 2.6 mmbls (API - 3.1 mmbls) Distillates - 3.7 mmbls (API - 6.9 mmbls) Crude Import 9.5 mmbopd Gasoline Imports 1.0 mmbopd Refineries 87.3% Gasoline Demand 9.1 mmbopd Distillate Demand 4.3 mmbopd Total Petroleum Inventories - 10.4 mmbls Big difference in the numbers between DOE and API. Again the low imports eat into the Crude supply. It all depends on the weather going forward and there you have to recall that winter is running out of time.. A market neutral to positive report. 7/2 GMT 09.58 Oil USA - Statistics from the DOE - API I expect, Crude + 2.5 mmbls Gasoline + 2.5 mmbls Distillates - 3.0 mmbls Crude Import 10.0 mmbopd Gasoline Imports 1.2 mmbopd Refineries 87.0% Gasoline Demand 9.1 mmbopd Distillate Demand 4.3 mmbopd Total Petroleum Inventories + 2.5 mmbls This will be reporting from the first full week of cold weather. As such itīs the Distillates that are most important. Yet winter is almost over and refiners are starting to convert to summertime Gasoline formulas. The work over programs have started hence the low output numbers. 6/2 GMT 22.27 Iran - US military strike - Update The USS John C. Stennis Carrier Battle Group has entered the US 7th Fleet and is steaming through the region on to itīs destination ie the US 5th Fleet. ETA is about two weeks. Also the USS Bataan passed through the Suez Canal on Tuesday on its way to the Persian Gulf. The seven vessel battle group includes 2,200 US Marines and sailors, helicopters and Harrier fighter jets. 6/2 GMT 19.13 OPEC - Saudi Arabia Saudi Arabia cut crude oil exports to Japan, South Korea and China, its three largest Asian customers by nearly 4% in Q4 compared to Q3 2006. The Saudi cuts of a total 88.000 bopd were part of the OPEC reductions that came into force on November 1. Japan, South Korea and China together imported some 2.362 mmbopd of Saudi crude during Q4, or about a third of the kingdom's total exports. This then down 5.4%, or 135,000 bopd, from a year ago. Saudi Arabia was according to the November reductions to cut 380.000 bopd. 6/2 GMT 11.58 Tanganyika Oil - TYK:TSX - TYKS:FN You do not want to be sitting on the sideline watching this stock go by... 2/2 GMT 21.02 Oil - The Contracts Bullish end to the week and the reason is, well pretty much take your pick. OPEC reductions that really are not reductions but then there you are. Nigeria, Iran, colder weather in the US and the US jobs numbers... etc. 1/2 GMT 23.25 Japan - Oil Imports Japan cut its crude oil imports from Kuwait by 6.4% to 108.5m barrels in 2006. Japan's total imports of crude fell 0.8% to 1.53bn barrels. Imports from the Middle East make up 89.2% of the total, of which Kuwait accountes for a 7.1% share. I point this out simply because it is one of the first indicators as to how 2006 was in the oil market concerning supply/demand.. 1/2 GMT 17.38 OPEC - Production Reductions OPEC said it would cut 500.000 mbopd by the 1/2, so far the "promised" cuts are as follow, UAE 40.000 bopd Kuwait 42.000 bopd Saudi Arabia 158.000 bopd Venezuela 57.000 bopd Iran 150.000 bopd Total 447.000 bopd Iran and Venezuela are the late bloomers in this and I must add the countries you least can count on to actually do what they have said they would, yet there you are. On the other hand there are also on the ground shipping and loading information about as I have pointed out before that gives a contrary view of things. But the market has today to factor in a "promised" OPEC cut of 447.000 bopd. This at a time of year when exports fall anyway so I would say that OPEC has not really done anything here more than to adjust the numbers to reality. 1/2 GMT 16.14 Oil USA - Statistics from the DOE - API Natural Gas draw -186 bcf.. Less than most expected. 1/2 GMT 11.52 Oil - The Contracts Impressive strength in the contracts, perhaps a bit unwarrented but then there you are. The lower Distillate numbers from the US seem to have done the trick. Only one thing - its winter! Never mind... Natural Gas is a driver and if the storage numbers come in softer than expected.. Only one thing - its winter! Looking at the weather forecast for the US North East going forward makes you none the wiser except for the fact that spring is more and more just around the corner. OPEC cuts effective as of today are as stated only about 50% of promised and only time will realy tell how much impact they made. Gathering from the US Imports not much effect to date. Happy Trading! 1/2 GMT 11.43 Oil USA - Statistics from the DOE - API out GMT 15.30 Expect a Natural Gas draw of -200 bcf.. 31/1 GMT 15.30 Oil USA - Statistics from the DOE - API Crude + 2.7 mmbls (API + 5.7 mmbls) Gasoline + 3.8 mmbls (API + 1.3 mmbls) Distillates - 2.6 mmbls (API - 1.0 mmbls) Crude Import 10.0 mmbopd Gasoline Imports 1.3 mmbopd Refineries 87.1% Gasoline Demand 9.1 mmbopd Distillate Demand 4.2 mmbopd Total Petroleum Inventories + 0.3 mmbls The draw on Distillates was larger than expected but with a sudden cold patch itīs hard to judge the actual demand, which only rose slightly. More to come next week. Yet with Distillates it should be noted that the actual Heating Oil component has been dropping over the last month ie Refiners simply are refining less high-sulfur distillate fuel, going into the summer period. Gasoline is again building and that has an effect going forward. Pretty much as expected and not a report that will send the contracts to the moon. The API numbers for Crude are worth looking at as they will spill on over into next week. A market negative to neutral report. Going forward the Strategic Petroleum Reserve SPR injection will become of interest, this is not set to start until April. 31/1 GMT 11.29 Oil - The Historical Price of Oil Annual Average Crude Oil Prices 1946 - 2006... US Average in $/bbl. Year Average Inflation Price Adjusted 1946 $1.63 $16.68 1947 $2.16 $19.60 1948 $2.77 $23.38 1949 $2.77 $23.61 1950 $2.77 $23.36 1951 $2.77 $21.65 1952 $2.77 $21.17 1953 $2.92 $22.10 1954 $2.99 $22.59 1955 $2.93 $22.17 1956 $2.94 $21.96 1957 $3.00 $22.66 1958 $3.01 $21.09 1959 $3.00 $20.88 1960 $2.91 $19.98 1961 $2.85 $19.35 1962 $2.85 $19.12 1963 $3.00 $19.29 1964 $2.88 $19.63 1965 $3.01 $19.37 1966 $3.10 $19.38 1967 $3.12 $18.98 1968 $3.18 $18.52 1969 $3.32 $18.37 1970 $3.39 $17.72 1971 $3.60 $18.04 1972 $3.60 $17.47 1973 $4.75 $21.53 1974 $9.35 $38.42 1975 $7.67 $46.01 1976 $13.10 $46.72 1977 $14.40 $48.19 1978 $14.95 $46.53 1979 $25.10 $69.51 1980 $37.42 $92.26 ATH.. 1981 $35.75 $79.89 1982 $31.83 $66.97 1983 $29.08 $59.26 1984 $28.75 $56.17 1985 $26.92 $50.77 1986 $14.44 $26.72 1987 $17.75 $31.69 1988 $14.87 $25.55 1989 $18.33 $29.99 1990 $23.19 $35.91 1991 $20.20 $30.10 1992 $19.25 $27.84 1993 $16.75 $23.54 1994 $15.66 $21.43 1995 $16.75 $22.31 1996 $20.46 $26.45 1997 $18.64 $23.57 1998 $11.91 $14.83 1999 $16.56 $20.12 2000 $27.39 $32.26 2001 $23.00 $26.37 2002 $22.81 $25.71 2003 $27.69 $30.55 2004 $37.66 $40.42 2005 $50.04 $51.94 2006 $60.40 $60.78 31/1 GMT 09.31 Oil - 2007 As goes January, often goes the year... It's called the January effect, as many investors believe that trading in the first month of the year sets the tone for the full year. It's clear that the Nymex crude futures market, too, has its own version. In 18 of the past 22 years ie 82% of the time the price direction of front-month crude futures in January compared with December has been an indicator of annual price moves. If that holds true this year as it has for the past 9 straight years 2007 average prices will be lower than the record $66.22 a barrel set in 2006. Below $60 Every Day in January... Crude oil futures opened the year on 3/1 with a 4.5% fall from the last trading day of 2006. But, so far that $58.32 settlement price (the low since 17/11 2006) stands as the strongest price in January. Barring a move of more than 5.3% on Wednesday, January will be the first month since May 2005 that prices didn't settle above $60 on any day. Prices averaged $54.15 through Tuesday. Yet never in the history of Nymex crude trading has the settlement price on the first day of the year stood as the highest settlement for the year. 30/1 GMT 20.53 Oil - The Contracts Thanks Saudi Arabia, I guess... I would take this nice uptick with a large pinch of salt as the market was howling for some bullish news and OPEC came bearing gifts of plenty. The parallel to last weeks expiration moves prior to the US Stats is apparent and I belive we are just trading within the range evenso the movement is volatile. Donīt bank on this uptick being more than just that an uptick, nice as they are and why I suppose we are in the oil patch - because oil rocks! OPEC has only delivered about 50% of stated cuts and thatīs the official line.. Which also means that OPEC is again building spare production capacity so you have to stand back and see the bigger picture in this and get totally confused. *g* The DOE/API stats can turn this move in a minute.. 30/1 GMT 13.35 OPEC - Production Reductions Yet one more reduction statement has come in and the latest out of the gate is Saudi Arabia this then from the 500.000 mbopd OPEC said it would cut by the 1/2, so far the "promised" cuts are as follow, UAE 40.000 bopd Kuwait 42.000 bopd Saudi Arabia 158.000 bopd Total 240.000 bopd In this it is the Saudis that actually can move the market but 158.000 bopd is more or less a correction to on the ground realities as shipments to Asia have been filled through February middle of March. With the Saudi reduction OPEC is about half way to making good on its promise. See earlier postings on OPEC production and export. It is hard to see from where any further cuts will come. So OPECs actual cuts to date are 0.7 mmbopd and 0.24 mmbopd a total of 0.94 mmbopd against a target of 1.7 mmbopd.... 30/1 GMT 08.29 Oil USA - Statistics from the DOE - API 31/1 GMT 15.30 I expect, Crude + 2.5 mmbls Gasoline + 5.0 mmbls Distillates - 1.0 mmbls Crude Import 10.1 mmbopd Gasoline Imports 0.9 mmbopd Refineries 87.8% Gasoline Demand 9.1 mmbopd Distillate Demand 4.2 mmbopd Total Petroleum Inventories + 7.5 mmbls The only variant in the whole is how much did the cold snap realy matter. A short period of cold weather usually does not deplete stocks that much as demand takes a bit of time to build. With Refiners gearing up for the summer season already the transition period is going to be harder to call. Yet storage of products are at todays demand levels more than ample. 29/1 GMT 20.47 Oil - The Contracts - USA Unless the DOE/API reports come out Market Neutral to Positive this week the contracts are going to gravitate down towards the $50 mark. The cold snap has I belive done little to change the overall view of the market. Refiners are already starting to gear up for Gasoline as most are betting on the fact that Distillate storage is ample for the short time left of real winter ie 14 to 21 days. Geopoliticals is the only real driver North, unless ofcourse the weather turns real nasty, donīt think so... 29/1 GMT 08.15 Iran - US military strike Saudi Arabia is no real friend to Iran, they are for sure members of OPEC and neighbours as such but that is about it. In this Saudi Arabia has a great power hold over Iran in that it can at will dictate the price of oil and in this it is doing so now. Irans major source of income comes from oil to the tune of 90% of GDP, a very brittle state of affairs. Iran with itīs stance against the world is gaining few allies and only enemies in the region. Iran with a nuclear bomb!? The lower the price of oil the greater the pressure on Iran to comply with the UN resolutions or risk action, which is coming and it seems increaslingly so sooner rather than later. In this the troop build up in Iraq of 21.000 is on one hand a build in country but also a safety for anything that can occur once Iran is attacked. The oil price pressure is the interesting dimension in this as it is the only feet on the ground part of what is coming ie an attack. In this any action against Iran will be from the air with not one single boot on the ground exept for the feet that are there now in preparation.. Case in point.. Saudis hint at $50-a-barrel oil; Iran may be one reason Saudi Arabia, which benefited immensely from record oil prices last year, has sent signals in the past two weeks that it is committed to keeping oil at around $50 a barrel down $27 from the summer peak that shook consumers across the developed world. The indications came in typically cryptic fashion for the oil-rich kingdom. In Tokyo last week, Saudi Oil Minister Ali al-Naimi said Saudi Arabia's policy was to maintain "moderate prices." The previous week, on a stop in New Delhi, he effectively put his veto on an emergency meeting of the Organization of the Petroleum Exporting Countries to prop up prices after oil briefly dropped below $50 a barrel, the lowest level in nearly two years. The events that propelled oil prices above $77 a barrel in July were beyond any single producer's control. Still, Saudi Arabia, by far the largest OPEC producer and the country that usually sets the cartel's agenda, is seeking to avoid a repeat of the dramatic run-up in prices while trying to put a floor beneath them. Other motives also seem to be at work, including the Saudis' desire to restrain the ambitions of Iran. Nowhere was last summer's spike in oil prices felt more profoundly than in the United States. As gasoline rose above $3 a gallon, consumers cut spending elsewhere, tamping down profits in retail, travel and other industries. U.S. automakers were devastated as consumers fled from large vehicles to smaller ones, historically the specialty of the Japanese; Ford on Thursday announced that 2006 had been its worst year. The recent slide back to $50 a barrel which translates to about $2 for a gallon of gasoline in the United States has eased the pressure on the domestic economy, quieting talk that oil prices and the declining housing market would lead to a recession. The Saudis appear to be relearning the fact that painfully high energy prices take a profound toll on the global economy, which reduces demand for oil. How much influence the United States has exerted is an open question. Vice President Dick Cheney met with Saudi King Abdullah in Riyadh in November, but his office would not say if oil was discussed. The White House has been supportive of Saudi energy policy, and President Bush and his father are close with Prince Bandar bin Sultan, the national-security minister and former ambassador to the United States. Although Saudi officials say their oil policy is based on market considerations and not political ones, the November meeting led to renewed speculation that the kingdom might be tempted to dry out Iran's ambitions by pushing oil prices down. Prices already have been falling because of mild weather and slowing demand. Prices at $50 to $55 a barrel are about right for the Saudis, according to Saudi energy officials not too high to hurt the global economy, not too low to hurt their economy. Last year's record highs meant that the growth in global oil demand slowed to 1 percent in 2006, compared with a 4 percent increase at its peak in 2004. But 2006 was not the first reminder for the Saudis that too-high prices can backfire. The oil shocks of the 1970s and '80s also set off a scramble for gas-sipping cars and a brief push to wean the West from its oil dependency. In recent months, the higher prices have rekindled America's quest for alternatives and propelled energy security to the top of the agenda in the United States and Europe. Even Bush, who began his presidency seeking to increase domestic oil production, called for cuts in gasoline consumption over the next decade in last week's State of the Union address. High prices also have emboldened rivals within OPEC, among them Iran and Venezuela, which have used their oil revenue to prop up their governments and export their more radical agendas. Saudi Arabia has worked cooperatively with Iran since the late 1990s, when oil producers were panicked by the decline of prices to around $10 a barrel. More recently, Iran has favored rising prices over the moderation that Saudi Arabia seeks. Venezuela also tends to favor higher prices but wields less political influence. "High prices are not in the interest of Saudi Arabia," said Sadek Boussena, a former OPEC president from Algeria. "We've all seen what $70 does: It attracts alternatives, it reduces demand. On the other hand, I don't think the Saudis want oil below $50. They need the revenue." There is no scientific formula for setting oil prices. In the 1980s, the market settled on around $18 a barrel. In the 1990s, it was ratcheted up to $22 to $25 a barrel. Recently, oil producers have realized they can charge twice that amount without significantly stifling the global economy, although consuming nations still complain that the price is too high. Naimi, the Saudi oil minister, is rarely explicit about his plans. His every word is dissected by legions of analysts for the slightest hint of an inflection in policy. Sometimes, the uncertainty gives rise to more conspiratorial theories. Oil traders have been buzzing in recent weeks about whether Saudi Arabia was actively seeking to depress oil markets in hopes of crippling Iran's economy, as a Saudi analyst albeit not one from the government suggested in an opinion article in The Washington Post late last year. The Saudis quickly dismissed the claim. "It is difficult to work out what the Saudis really want, since they never say things explicitly," said Leo Drollas, chief economist at the Center for Global Energy Studies, a London-based research group founded by Sheik Ahmed Zaki Yamani, a former Saudi oil minister. Sometimes, he said, "you have to read between the lines." - Jad Mouawad 29/1 GMT 07.55 Oil - The Contracts Again I would have to point out that $50 WTI is a place of balance today... 26/1 GMT 10.50 Tanganyika Oil - TYK:TSX - TYKS:FN As stated I have a Strong Buy rating on this one and it is getting stronger by the week. But donīt wait too many weeks to buy it at anywhere near todays levels... Good trading in the stock of late, nice fluctuations. 25/1 GMT 15.30 Oil USA - Statistics from the DOE - API Natural Gas - 179 Bcf. I expected a lower draw but then there you are. Stocks are 472 Bcf above the 5-year average of 2,285 Bcf. Next week is when the cold snap starts showing up in the numbers.. A market neutral to fairly negative report. 24/1 GMT 15.30 Oil USA - Statistics from the DOE - API Crude + 0.7 mmbls (API - 0.8 mmbls) Gasoline + 4.0 mmbls (API - 2.0 mmbls) Distillates + 0.7 mmbls (API - 4.2 mmbls) Crude Import 9.8 mmbopd Gasoline Imports 0.9 mmbopd Refineries 87.4% - 0.5% Gasoline Demand 9.1 mmbopd Distillate Demand 4.1 mmbopd Total Petroleum Inventories + 1.5 mmbls The low Crude numbers are due to lower Imports down by 1.3 mmbopd, it adds up in the end. Refiners backed off. Gasoline demand lower and Distillates neutral. The lower than expected build in Crude is offset by the products. Distillate demand is over 4% below last year. On the whole the picture is that despite low refinery runs the products saw a build and that is due to again low demand. A market neutral to fairly negative report. 23/1 GMT 23.01 The Site.. has had since I restarted it in January of 2005 a total of 3.62 million visitors from as many as 71 countries. Thanks! 23/1 GMT 22.40 Oil - The Contracts A 5% jump for Crude, a good uptick due to Nigeria, Colder Weather in the US, Iran and ofcourse Contract Expiration.. Yet also the US SPR extention, which is the one that has least effect on the current price structure but Hey everyone was Happy and Bullish so lets add it to the mix. Iran is the big one looming and military action always means a risk-premium yet if Iran was taken off the export grid in the short term the loss could be filled by Saudi Arabia. With little or no spare capacity as a result but Iranian oil export halted would on the ground mean less than most think. Yet it was a Bullish Day and all should rejoice. If the DOE/API numbers come in as I expect well sorry but that would take some steam out of the ascent. 23/1 GMT 22.32 USA - Strategic Petroleum Reserve The prospect of building the SPR to 1.5 billion barrels is a good one and better than the original increase of 1 billion barrels put to Congress some time ago. Now the build will take some while ie until 2027 at about 100.000 bopd or there about all depending on other conditions. The build will give the US about 100 net import days of use when filled. 23/1 GMT 13.48 Oil USA - Statistics from the DOE - API 24/1 GMT 15.30 I expect, Crude + 4.0 mmbls Gasoline + 2.5 mmbls Distillates - 1.0 mmbls Natural Gas - 142 bcf (corrected) Crude Import 11.0 mmbopd Gasoline Imports 1.0 mmbopd Refineries 88.5% Gasoline Demand 9.2 mmbopd Distillate Demand 4.1 mmbopd Total Petroleum Inventories + 7.0 mmbls A cold snap does not a winter make and even if the cold will stay around for 5 to 7 days more I donīt see that it has done much to change the situation. The Refinery numbers were down last week and if that stays the trend this then Crude supplies could see even bigger storage. Import and Refineries... 19/1 GMT 15.48 Oil USA - Statistics from the DOE - API Crude + 6.8 mmbls (API + 7.6 mmbls) Gasoline + 3.5 mmbls (API + 3.3 mmbls) Distillates + 0.9 mmbls (API + 0.4 mmbls) Natural Gas - 89 bcf Crude Import 11.1 mmbopd Gasoline Imports 1.0 mmbopd Refineries 87.9% Gasoline Demand 9.2 mmbopd Distillate Demand 4.1 mmbopd Total Petroleum Inventories + 9.0 mmbls Due to the lower than expected Refinery runs the Crude numbers surged. Imports rose again. Falling demand is the main factor. A market neutral to negative report. 18/1 GMT 00.10 OPEC - No more reductions - What reductions? OPEC are expected to produce about 800.000 mbopd over their quota in January, this then contrary to all the reduction talk - as always with OPEC more talk. OPECīs production in January will be 27.1 mmbopd as opposed to the 26.3 mmbopd agreed on. If you add Iraq and Angola to the group then production in January will come in at, wait for it 30.6 mmbopd!! 17/1 GMT 15.45 Iraq - DNO - DNO:NO Reports say Iraq's Oil Committee, which groups senior national and regional leaders, has agreed a final draft of an oil law that sets rules for sharing revenues and boosting output. Oil Ministry spokesman Asim Jihad said the draft calls for a federal committee headed by the prime minister to oversee all contracts. It would also have the power to review existing deals signed under Saddam Hussein or by the Kurdish regional government. Jihad said the bill would go to the cabinet next week for consideration. 17/1 GMT 13.14 Iran - US military strike - Update For the first time since 2003 ie pre-Iraq invasion the US will have two Aircraft Carrier Battle Groups stationed in the Persian Gulf. Just a point of notice... The USS John C. Stennis has sailed from Bremerton, Washington and will be on station within 30 days. Included in the build up is one Patriot missile battalion. Already in the Persian Gulf is the Aircraft Carrier Dwight D. Eisenhower along with itīs Battle Group. The USS Stennis will have around 5,000 sailors, as well as around 80 fixed wing aircraft, including F/A-18 Hornet and Superhornet fighter-bombers. The USS Dwight D. Eisenhower has 90 fixed wing aircraft and helicopters, 5.700 crew. 16/1 GMT 23.06 Oil - The Contracts OPEC as I stated earlier says no cuts needed well when you know you are going to fail then donīt attempt. Oil is heading for the $40īs and of itīs own accord due to the fundamentals. OPEC is still making money at this level of price in fact during OPEC history it has sold oil at below $40 at a stagering 94% of the time. Todays oil price is frankly an anomaly as far as the organisation is concerned. I do see $50 as a level of balance right now but with USA weather services now predicting warmer than normal weather through March well how low is low. Any surge in the price level will be down to Geopoliticals and there we have a few interesting events coming up... 16/1 GMT 21.51 Oil USA - Statistics from the DOE - API 18/1 GMT 15.30 I expect, Crude - 3.0 mmbls Gasoline + 4.0 mmbls Distillates + 3.5 mmbls Natural Gas - 40 bcf Crude Import 9.8 mmbopd Gasoline Imports 1.0 mmbopd Refineries 91.8% Gasoline Demand 9.3 mmbopd Distillate Demand 4.2 mmbopd Total Petroleum Inventories + 8.0 mmbls Crude should be down again due to the high Refinery Runs and with warm weather still a part of the equation Distillates judged on lower demand should see a good increase. With yet another week of no real winter Refiners are going to start planing for early workovers and this can throw the numbers but until then it is more of the same I suspect. There have been no known loading problems so the import numbers could be higher for Crude. 16/1 GMT 13.35 OPEC - No more reductions As I expected Saudi Arabias Oil Minister has stated that OPEC does not seek more reductions in production for the simple reason they would just look more foolish then they already are. OPEC is today cheating and as the oil price drops the cheating escalates which in turn brings more oil to the market ie more over supply. This is something that happens in the oil patch on a regular basis and itīs all part of the game. 15/1 GMT 23.45 Arafura Resources NL - ARU:ASX One to watch... 15/1 GMT 09.13 Venezuela - Oil Industry Nationalised Look for Chavez to nationalise the countries oil industry any day now. Phase one the Orinoco oil fields.. 14/1 GMT 17.25 China - Oil Demand - Updated 2002 5.0 mmbopd 2003 5.3 mmbopd 2004 6.6 mmbopd 2005 6.4 mmbopd 2006 5.5 mmbopd? Again, the Chinese Embassy in the USA published statistics on the 2/3/06 that stated that Chinas Oil demand in 2005 was 6.36 mmbopd. I have adjusted the demand list accordingly. So whom do you belive? From several sources in China it seems that the countries oil demand is lower than most have expected, so how low? If the total demand in 2006 was 2 billion barrels then 5.5 mmbopd is just about right and this then closer to the actual 2005 demand numbers than the estimated 7.5 mmbopd for 2006. I belive the truth is closer to 5.5 mmbopd and this then in line with shipping and loading numbers for Asia, even if China in this is hard to get a grip on when it comes to statistics. Yet as clear statistics are hard to come by for China lets assume that 5.5 mmbopd could be as high as 6.5 mmbopd it would still only mean that China saw no real growth in demand during 2006, this then contrary to what everyone has belived and traded on... Interesting. 14/1 GMT 16.56 Iran - US military strike US military strike on Iran seen by April 2007; Sea-launched attack to hit oil, Nuclear sites.. Washington will launch a military strike on Iran before April 2007, say sources. The attack will be launched from the sea and Patriot missiles will guard all oil-producing countries in the region, they add. Recent statements emanating from the United States indicate the Bush administration’s new strategy for Iraq doesn’t include any proposal to make a compromise or negotiate with Syria or Iran. A reliable source said President Bush recently held a meeting with Vice President Dick Cheney, Defense Secretary Robert Gates, Secretary of State Dr Condoleezza Rice and other assistants in the White House where they discussed the plan to attack Iran in minute detail. According to the source, Vice President Dick Cheney highlighted the threat posed by Iran to not only Saudi Arabia but the whole region. “Tehran is not playing politics. Iranian leaders are using their country’s religious influence to support the aggressive regime’s ambition to expand,” the source quoted Dick Cheney as saying. Indicating participants of the meeting agreed to impose restrictions on the ambitions of Iranian regime before April 2007 without exposing other countries in the region to any danger, the source said “they have chosen April as British Prime Minister Tony Blair has said it will be the last month in office for him. The United States has to take action against Iran and Syria before April 2007.” Claiming the attack will be launched from the sea and not from any country in the region, he said “the US and its allies will target the oil installations and nuclear facilities of Iran ensuring there is no environmental catastrophe or after effects.” “Already the US has started sending its warships to the Gulf and the build-up will continue until Washington has the required number by the end of this month,” the source said. “US forces in Iraq and other countries in the region will be protected against any Iranian missile attack by an advanced Patriot missile system.” He went on to say “although US Defense Secretary Robert Gates and Secretary of State Dr Condoleezza Rice suggested postponing the attack, President Bush and Vice President Dick Cheney insisted on attacking Tehran without any negotiations based on the lesson they learnt in Iraq recently.” The Bush administration believes attacking Iran will create a new power balance in the region, calm down the situation in Iraq and pave the way for their democratic project, which had to be suspended due to the interference of Tehran and Damascus in Iraq, he continued. The attack on Iran will weaken the Syrian regime, which will eventually fade away, the source said. 11/1 GMT 23.23 Oil - The Big Fall WTI close to $50.. This has been coming for months. The world is well supplied with oil, over supplied. The US has storage levels above average and the Northen part of the planet has been warmer than normal. Unless you have been on Mars for the last 6 months you would know and be ready for this fall and the market preceeding the retreat. How far will it go well thats the question but I think we are at levels that will be with us during the rest of Q1 unless geopols get in the way. The Dollar has strengthened and that is part of the lower oil contracts but mostly it is just the simple fact that the world has lots of oil and a building spare production capacity. Look for OPEC to say one thing and cheat on production going forward ie no more real cuts. 10/1 GMT 22.43 China - Oil Demand - Updated 2002 5.0 mmbopd 2003 5.3 mmbopd 2004 6.6 mmbopd 2005 6.5 mmbopd 2006 --- mmbopd So you are wondering about the 2006 numbers, well. As stated a report out on Tuesday 9/1 from Xinhua News Agency ie State News says that total oil demand in 2006 is estimated at just over 2 billion barrels.. Now lets look at that number 2 billion barrels. That should mean that Chinas Oil Demand was 5.5 mmbopd in 2006, this then far from the estimates and in this most are estimates from EIA, DOE/IEA etc of 7.5 mmbopd. So why the big divergence? 7.5 mmbopd would mean a yearly total demand of 2.8 billion barrels. The Chinese Embassy in the USA published statistics on the 2/3/06 that stated that Chinas Oil demand in 2005 was 6.36 mmbopd. This then below the 6.5 mmbopd in the list. So is it possible that Chinas oil demand in 2006 was only 5.5 mmbopd and not the estimated 7.5 mmbopd? Well if you listen to the official line the fall in demand 2005 set against 2004 was due to "The government's effort at building a resource- and energy-saving society has paid off". So according to Chinas Embassy in the USA Oil demand in 2005 was 6.36 mmbopd and falling due to "resource- and energy-saving". Also Lin Yueqin, a researcher with the Chinese Academy of Social Sciences, attributed the decreased oil consumption and imports to soaring prices. "High oil prices forced users to consider saving measures, causing less imported oil." This from the same report on Chinas Embassy homepage. http://www.china-embassy.org/ So is it possible that Chinas Oil Demand in 2006 was only 5.5 mmbopd as opposed to the markets belife that it was 7.5 mmbopd? Yeah sure it is possible and even credible. More to come... 10/1 GMT 21.38 USA - ETF - United States Oil Fund USO End of trade at low for the day on good volume. Any upturn is going to be short term. A new trading range $45 to $50.. After a test of the $45 support level. 10/1 GMT 17.22 OPEC - Production Reductions So the reduction statements are starting to roll in and from the 500.000 mbopd OPEC said it would cut by the 1/2, so far the "promised" cuts are as follow, UAE 40.000 bopd Kuwait 42.000 bopd 10/1 GMT 15.30 Oil USA - Statistics from the DOE - API Crude - 5.0 mmbls (API - 7.7 mmbls) Gasoline + 3.8 mmbls (API + 8.6 mmbls) Distillates + 5.4 mmbls (API + 4.0 mmbls) Natural Gas - 49 bcf (11/1) Crude Import 9.5 mmbopd Gasoline Imports 1.0 mmbopd Refineries 91.5% Gasoline Demand 9.3 mmbopd Distillate Demand 4.2 mmbopd Total Petroleum Inventories + 7.4 mmbls The salient factor here is the increase in Total Inventories and the products. The large draw in Crude is due to the build in Gasoline and Distillates. Distillate demand is way below normal for this time of year. The API numbers are along the same line as the DOE numbers but come from different criteria. Again Crude storage is above average and the draws are due to the build in products, this in its turn will lead to interesting problems in Q2 if it continues with Refiner work overs etc.. A market neutral to negative report. 9/1 GMT 23.11 China - Oil Demand 1993 2.5 mmbopd 1994 3.0 mmbopd 1995 3.3 mmbopd 1996 3.5 mmbopd 1997 4.0 mmbopd 1998 4.5 mmbopd 1999 4.6 mmbopd 2000 4.7 mmbopd 2001 4.8 mmbopd 2002 5.0 mmbopd 2003 5.3 mmbopd 2004 6.6 mmbopd 2005 6.5 mmbopd 2006 --- mmbopd So you are wondering about the 2006 numbers, well. A report out on Tuesday from Xinhua News Agency ie State News says that total oil demand in 2006 is estimated at just over 2 billion barrels, citing Liang Shuhe, Deputy Director of the Foreign Trade Department. Based on that figure the current estimates of Chinas 2006 Oil Demand of about 7.5 mmbopd pretty much goes out the window.. More to come.. 9/1 GMT 21.59 India - Oil Demand 1993 1.3 mmbopd 1994 1.4 mmbopd 1995 1.6 mmbopd 1996 1.7 mmbopd 1997 1.8 mmbopd 1998 1.8 mmbopd 1999 2.0 mmbopd 2000 2.1 mmbopd 2001 2.2 mmbopd 2002 2.3 mmbopd 2003 2.3 mmbopd 2004 2.3 mmbopd 2010 3.0 mmbopd (projected) 9/1 GMT 16.51 OPEC - Production Reductions More cuts say OPEC.. Well guys how about actually cutting what you already have said you would. 1.2 mmbopd became 0.7 mmbopd, the 0.5 mmbopd decided in December is still not showing up in statements from anyone apart from the UAE. Now there is talk of more... OPEC production in December actually rose by 0.1 mmbopd. 8/1 GMT 22.15 Oil USA - Statistics from the DOE - API 10/1 GMT 15.30 I expect, Crude + 1.8 mmbls Gasoline + 4.5 mmbls Distillates + 2.5 mmbls Natural Gas - 40 bcf Crude Import 10.0 mmbopd Gasoline Imports 1.4 mmbopd Refineries 91.2% Gasoline Demand 9.3 mmbopd Distillate Demand 4.3 mmbopd Total Petroleum Inventories + 4.5 mmbls As Crude regained the huge drop over the last few weeks last week, as I expected I see this continuing even this week. A build across the board... 8/1 GMT 13.08 Oil - The Week Ahead Record temps in Nwe York over the weekend and the warmer weather is expected to stay around at least until the 15th of the month so oil contracts are going to have a shaky week. Down over 8% last week and as I pointed out the week before last the Crude numbers picked up and storage will be up again this week. Itīs the US weather and Geopolitics that are the driving forces for the contracts and in this the weather is saying contracts down. Also the $55 support level for WTI was broken last week so $50 to $52 is the next big floor. Yet! The Geopoliticals are saying something else with Russia again in Power Play mode with the ongoing problem between Russia and Belarus and then there is OPEC talking reductions, the latter just that much more talk. Russiaīs role as a contract mover is going to increase going forward.... A bit of housekeeping from the week the site was not Updated Report week ending 29 December, Crude - 1.3 mmbls (API + 1.7 mmbls) Gasoline + 5.6 mmbls (API + 6.7 mmbls) Distillates + 2.0 mmbls (API + 5.3 mmbls) Natural Gas - 47 bcf Crude Import 10.1 mmbopd Gasoline Imports 1.3 mmbopd Refineries 91.0% Gasoline Demand 9.3 mmbopd Distillate Demand 4.3 mmbopd Total Petroleum Inventories + 1.8 mmbls 1/1 GMT 21.58 Russia - The Power Grab - Sakhalin 2 - EBRD The European Bank of Reconstruction and Development is as it seems taking a stand against Putins nationalization of the energy sector by having second thoughts about financing the Shell Sakhalin 2 project. In this one has to remember that nationalized oil industries are not uncommon - Statoil is one example yet Russia is in dier need of investment so the EBRDīs decision looks set to be a real wake up call for the Kreml. 1/1 GMT 20.22 USA - ETF - United States Oil Fund USO The fund is of late tracking between $50 and $55 with fairly regular swings. The holiday season aside I see this continuing unless the US weather factor really grabs the oil market and in this Europe is also way warmer than normal so energy consumption is going to be way down. 1/1 GMT 19.59 Tanganyika Oil - TYK:TSX - TYKS:FN With the new listing in Stockholm on the Small or most probably Mid Cap List the company gets a boost as to investor access, in this the list change is due shortly. I would not be surprised if this leads to a de-listing in Canada. The reason simply being efficency... The share price has of late been driven to a large extent by "end of year" tax trade in Stockholm and the stock could fall back some but as stated earlier this is only of interest for those who trade the stock. The Strong Buy rating on this one has not changed. Why would it? Looking at the very ambitious drilling program for 2007 and the cost well you donīt have to be a rocket scientist to figure out that something is afoot. Heavy Oil is going to be more and more important going forward and as I have stated earlier China is one country that uses huge amounts of the stuff. All we now need is that little bankable paper from an independent assessor as to the range of the Syrian reserve... 1/1 GMT 14.35 Canmex Minerals Corporation - CXM.V - Range Resources - RRS:ASX - Somalia Somalias Prime Minister has asked the African Union to send peacekeepers to his country. Given about as effective as asking the UN to send troops but then there you are... This does however show that there is a government and that it is looking to solve the ongoing situation. The Union of Islamic Courts - UIC are retreating and look set to lose this fight, yet the guerilla/suicide nonsense is probably going to follow. 31/12 GMT 00.01 Happy New Year and a Very Prosperous 2007 As the New Year starts progressing around the globe from East to West I want to wish all the very, very many readers of this site a Very Happy and Prosperous 2007! 29/12 GMT 17.51 OPEC - Production Reductions - UAE As I projected that OPEC could only manage to cut just over 50% or 685.000 mbopd of that which was said in November ie 1.2 mmbopd. We are now off on another reduction round this time for February 2007. The United Arab Emirates is first out with their projected cuts and they come in at about 40,000 bopd or about 4% of its production. In this OPEC have planned to cut 0.5 mmbopd in February. With most Refiners allready having filled their Feb07 loadings the reductions are again simply a way of meeting the actual demand on the ground. 29/12 GMT 14.40 Canmex Minerals Corporation - CXM.V - Somalia - Range Resources Somalia’s autonomous province of Puntland has approved its production sharing contract over four blocks with Canmex Minerals Corporation and Range Reosurces. This means that the $50 million deal to farm out an 80% operating stake in blocks 28, 29, 30 and 31 to Canmex can be in the bag by the end of January. 29/12 GMT 00.48 Cricket - The 2006/2007, 73rd Ashes Series Letīs see was it in 1921/1922 that England last was washed out in an Ashes Series..!? Looks like 5-0 from where I am sitting! 29/12 GMT 00.39 Tanganyika Oil - TYK:TSX - TYKS:FN - Update Some interesting thoughts on this one coming up... Been too busy but will post these thoughts during the weekend. Please note the imminent list change to the Small Cap list... 29/12 GMT 00.31 Canmex Minerals Corporation - CXM.V - Somalia The Islamic Courts are getting theirs in Somalia and if the Government with assistance from Ethiopia can set up a system that works this is all the better for Range and Canmex. Canmex does not still have a company site, check here for news. The Islamists have woved to turn to guerrilla warfare ie suicide bombers and the other accoutrements such groups use... Puntland has to date not been a region where any fighting has gone on. 27/12 GMT 15.30 Oil USA - Statistics from the DOE - API Crude - 8.1 mmbls (API na mmbls) Gasoline + 3.0 mmbls (API na mmbls) Distillates + 0.5 mmbls (API na mmbls) Natural Gas - 46 bcf (29/12) Crude Import 9.1 mmbopd Gasoline Imports 1.0 mmbopd Refineries 90.9% Gasoline Demand 9.4 mmbopd Distillate Demand 4.3 mmbopd Total Petroleum Inventories - 7.4 mmbls Ouch! Crude was way off the expected scale and in this low imports and good Refinery runs are the cause. Yet with builds in the products and warm weather expected the coming week the Crude numbers may not push the market too far. As Crude storage is still 12% above last year and above the five year average. Delays in off-loadings at LOOP have been ongoing due to fog. The actual Heating Oil component of Distillates decreased again. Look for Crude storage numbers to pick up the coming weeks as the weather clears. A market Neutral Report. Natural Gas numbers out 29/12 GMT 15.30... 27/12 GMT 11.27 Oil USA - Statistics from the DOE - API 28/12 GMT 15.30 I expect, Crude + 0.5 mmbls Gasoline + 1.0 mmbls Distillates + 1.0 mmbls Natural Gas - 55 bcf Crude Import 9.8 mmbopd Gasoline Imports 1.1 mmbopd Refineries 91.0% Gasoline Demand 9.4 mmbopd Distillate Demand 4.3 mmbopd Total Petroleum Inventories + 1.5 mmbls 26/12 GMT 22.17 Tanganyika Oil - TYK:TSX - TYKS:FN Some interesting thoughts on this one coming up... More later. 26/12 GMT 21.59 Oil - The Contracts Mild weather in the USA and supply are the measures to which the contracts are gauged. Look for builds in all the products and crude in the weeks DOE/API stats. Heating oil demand is expected to be 25% below average during the first week of January. Market neutral to negative week for oil. 26/12 GMT 21.50 Iran Irans production of oil is waining and again not becasue of any Peak Oil Nonsense. At the current rate of production depletion due to sanctions, inept management or just simply incompetense is going to leave Iran with a virtual zero oil production withing the next 10 to 15 years. The reason is very simple and very much certified ie that the country is producing oil with technology that is at best! 40 years old. Irans people have a though but clear choice ahead! Also Iran does not have the finances or the means to inpose oil as a weapon... Crudely put but there it is. Saudi Arabia at the current rate of production could more than well fill an Iranian non-production stance. Add to this NONOPEC production that is picking up as per usual this time of year. 26/12 GMT 18.07 USA - Imported Crude A repost that has one major change in that Algeria is now the sixth biggest oil exporter to the US. During the three first quarters of 2006 the US imported 12.5 mmbopd. CANADA 1.8 mmbopd MEXICO 1.7 mmbopd VENEZUELA 1.5 mmbopd SAUDI ARABIA 1.3 mmbopd NIGERIA 1.1 mmbopd ALGERIA 0.65 mmbopd IRAQ 0.5 mmbopd ANGOLA 0.4 mmbopd ECUADOR 0.4 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 25/12 GMT 15.36 Oil - VLCC Freight Rates Look for the retreat in the rates to continue through January. A test of the April levels...? Merry Christmas - Happy Holiday I would like to wish everyone a Very Merry Christmas and a Very Happy Holiday! 21/12 GMT 23.35 Russia - The Power Grab As expected Shell and its Japanese partners loose control of Sakhalin 2.. French Totals Kharyaga field is heading the same way as is BPīs TNK-BP Kovykta gas project... Again Kremls henchmen are RosPrirodNadzor and RosNedra. 21/12 GMT 00.40 Cricket - The 2006/2007, 73rd Ashes Series So who did win back the Ashes....? *G* 21/12 GMT 00.37 Greywolf.SE in your Mobile Phone From now on I will post time sensitive posts on a very low graphics page that can be read in your mobile. The information will be brief. Please bookmark www.greywolf.se/mobile.html in your mobile phone. 21/12 GMT 00.07 OPEC - Iran I wrote on 1/12 about the plight of the Iranian Oil Industry and now even the Finacial Times is bringing this up, *1/12 GMT 17.36 OPEC - Iran Irans current daily production of oil is about 4.0 mmbopd actually it is 3.9 mmbopd. This then is 5% below the countrys OPEC quota. Iran has 137 billion barrels in oil reserves second only to Saudia Arabia and perhaps Iraq and when it comes to natural gas it is again second this time to Russia. Yet the country is literally running out of oil, not because of any Peak Oil nonsense but rather because the pipes are rusty and the rigs lack new parts and investment is running at about 30% of what is actually nedded just to keep the ship afloat. Iran is sitting on a huge potential that is scwandering away due to the countrys political/religous regime. Did you know that before the Islamic Revolution Iran produced 6.1 mmbopd.. This then back in 1974. Since then sanctions and a serious lack of technology have brought the oil sector in to huge problems. Especially as a large part of the oil infrastructure was put in place in the 1920īs and 30īs.. I kid you not! From the FT, "Iran’s oil minister on Wednesday admitted that Tehran was having trouble financing oil projects, in a rare acknowledgment of the economic cost of its nuclear dispute. Iran’s oil production capacity, at 4.3m barrels per day, is set to reach 5m bpd, according to the country’s latest five-year plan, which closes in 2009. This would involve $16bn of investment in the sector. But the International Energy Agency reckons that Iran’s longer term plans to lift oil production to 6.8m bpd by 2030 would require nearly $80bn in investment, with expansion plans for the gas industry requiring an extra $85bn." In this I find the IEAīs estimates of investment needed to be conservative. 20/12 GMT 23.58 OPEC - Venezuela Come February Venezuela is set to book another 20 billion barrels of reserves. This will mean that the country will have P1 Reserves of 100 billion barrels. Ryder Scott are in the process of revising the countrys oil reserves and further builds are expected. Now this is Venezuela... Even so it is interesting that Venezuelas national 2007 budget is based on an oil price retained for its oil export of $29 pbo, this then a bit apart from the current $55-$58 pbo actually received. Now Venezuela has calculated wrongly the last three years on the actual oil price received which gives Hugo Chavez huge amounts of cash to buy new friends with... 20/12 GMT 23.47 Russia - Sakhalin 2 Project Thursday is when the the Russians will go back to the table with their Cash Bid... For Shell this is going to be as much as a 10% readjustment of the companies Total Oil Reserves. Well more likelly close to 5%, but still. It all depends on how this is booked at Shell. 20/12 GMT 15.30 Oil USA - Statistics from the DOE - API Crude - 6.3 mmbls (API - 4.3 mmbls) Gasoline + 1.0 mmbls (API - 0.3 mmbls) Distillates + 1.2 mmbls (API - 1.4 mmbls) Crude Import 8.9 mmbopd Gasoline Imports 0.9 mmbopd Refineries 90.7% Gasoline Demand 9.4 mmbopd Distillate Demand 4.3 mmbopd Total Petroleum Inventories - 7.9 mmbls Low import numbers for Crude and refiners running back up again cuts the Crude storage numbers. Gasoline demand is brisk and this then due to the warmer weather, more driving. There was speculation that bad weather at LOOP may have cut imports, fog apparently. Loading delays of a day or two quickly eats into the Crude storage numbers, especially as the Refiners are taking so much out. A market neutral report. 20/12 GMT 00.23 Russia - Sakhalin 2 Project Looks like Shell like its Japanese partners are going to go for the cash instead of a swap... Either way the Kreml gets control... 20/12 GMT 00.18 Petroceltic International PLC - PCI:LSE - PLC:IEX Check this one out! 19/12 GMT 23.40 Canmex Minerals Corporation - CXM.V - Somalia Trucking along nicely, given on horrible volume yet there you are... 19/12 GMT 23.19 Oil USA - Statistics from the DOE - API 20/12 15.30 GMT Crude - 2.5 mmbls Gasoline - 0.5 mmbls Distillates - 1.5 mmbls Natural Gas - 50 bcf Crude Import 9.8 mmbopd Gasoline Imports 1.0 mmbopd Refineries 89.5% Gasoline Demand 9.3 mmbopd Distillate Demand 4.3 mmbopd Total Petroleum Inventories - 8.0 mmbls Look at last weeks API stats... Down across the board and thus I expect the same from DOE this week. The API reports a slightly different measure as they see to oil and products in transit to a larger extent. The weather has thus far been mild with temps way above average in the parts of the country that matter when it comes to Heating Oil and Natural Gas. Yet it is winter and storage should be down. Anything else will take the top edge of the contracts right smart! Natural Gas I expect will take the largest hit, well it already has... 17/12 GMT 15.36 Russia - Sakhalin 2 Project Shells CEO Jeroen van der Veer has again had meetings with Gazprom and I suspect with representatives of Energy Minister Viktor Khristenko and the result from these meetings are going to be the litmus test as to where the Russians are heading. I belive that Putin wants to own Russian resources and in this all resources making foreign players operators or minority holders at best. It is the fact that it is not the Energy Minister who is pushing hard in this but it is the Environmental Agency RosPrirodNadzor who is doing the Kremls dirty work. RosPrirodNadzor have come down hard on many projects of late, Peter Hambro Mining the third largest company extracting gold in Russia is just one case. Exxons Sakhalin 1 project and BPīs TNK-BP are others. Shareholders and in this major shareholders of Royal Dutch Shell will meet with Russian Energy Minister Viktor Khristenko in Moscow this coming week. In other words an interesting week coming up. 15/12 GMT 00.42 USA - ETF - United States Oil Fund USO Nice uptick Thursday yet the close term trend has been down. In this if you get the swings right then trading is good if not well then better to sit it out and watch for awhile. OPEC drove trade today.. In this let the full extent of what the OPEC action realy means sink in over the weekend... 15/12 GMT 00.33 Tanganyika Oil - TYK:TSX - TYKS:FN If you are trading this stock in the hope of an imminent deal then you are on thin ice, so to speak. Syria has to be independently verified sometime during Q1 2007 and thatīs the whole story. Until then it is all pure speculation, good trading but just that on speculation... Happy trading! On the other hand if your horizon is longer then any price level close to todays is a Strong Buy. Even so I do see a possible pull back in the stock after the "close of year" trade. This then especially for the listing on First North. Could in this be wrong and in the larger scale of things merely a trading aspect. Again Happy trading! (I apologize for not having earlier changed the listing to First North from NMG in the subject heading) 15/12 GMT 00.21 OPEC - Another Reduction Well you have to hand it to OPEC, they said 1.2 mmbopd last time and it turned out to be about half and in this the whole truth is not yet in. Now itīs another 0.5 mmbopd in Q1 2007... You have to love the oil patch. With Saudi Arabia today only producing 8.7 mmbopd the cut is already done ie in real life and time. OPEC is simply again adjusting itīs on the ground production and calling it cuts. Now what is it called, oh yeah Spare Capacity! OPEC has increasingly lots of it... 14/12 GMT 13.47 OPEC - Saudi Arabia Saudi Arabia is currently producing at a rate of 8.7 mmbopd, Saudi Arabian Oil Minister Ali Naimi said Thursday. Naimi stated that the kingdom's oil output capacity is 11.3 mmbopd. 13/12 GMT 20.24 Tanganyika Oil - TYK:TSX - TYKS:FN - December Presentation Look for an update on the company site today.. 13/12 GMT 15.30 Oil USA - Statistics from the DOE - API Crude - 4.3 mmbls (API - 8.3 mmbls) Gasoline - 0.1 mmbls (API - 1.1 mmbls) Distillates - 0.5 mmbls (API - 2.7 mmbls) Natural Gas - 168 bcf Crude Import 9.6 mmbopd Gasoline Imports 1.0 mmbopd Refineries 89.1% - 1.4% Gasoline Demand 9.3 mmbopd Distillate Demand 4.3 mmbopd Total Petroleum Inventories - 7.5 mmbls Again the actual heating oil component of the Distillate numbers declined. Big draw for Crude third week running but as the products remain steady the market may see this neutral to market negative. Refiners backed off about half of last weeks gain. So whom do you belive? The API is most weeks a fair indicator as to next weeks numbers so.... Gasoline and Distillates are below average or on the brink - yet. And in this I would like to point out Crude storage is 12% above the average. The Oil industry is like any other in that it adjusts the product supply to the demand situation and in this there is a fine balance. Gasoline demand is the one to watch as warmer winters will lead to more driving and this then a Q2-Q3 worry. Always something to worry about... 12/12 GMT 21.49 Island Oil & Gas PLC IOG:LSE This is an interesting company in which Lundin Petroleum BV owns a 6.8% share... IOG is operating in the North Sea but has today announced that it has signed a reconnaissance contract for the granting of an Exclusive Reconnaissance in the Zag Basin onshore Morocco. The Licence, which is valid for a period of 12 months until December 2007, covers an area of 21,807 sq. kms. The work programme that has been committed to comprises geological field studies; a geochemical study; the processing and interpretation of gravity and magnetic data; and the interpretation of satellite data. IOG has a 20% share in this.. 12/12 GMT 21.22 Oil USA - Statistics from the DOE - API 13/12 GMT 15.30 I expect, Crude - 0.5 mmbls Gasoline + 2.0 mmbls Distillates +- 0.0 mmbls Natural Gas - 115 bcf Crude Import 10.0 mmbopd Gasoline Imports 1.0 mmbopd Refineries 90.5% Gasoline Demand 9.2 mmbopd Distillate Demand 4.3 mmbopd Total Petroleum Inventories - 2.0 mmbls Seasonaly warm weather is back after a short cold spell last week and it looks set to stay around for awhile. I half expect a build across the board yet with refiners up and running crude is as expected. Itīs all about the extent of the thing called winter... 12/12 GMT 08.31 Lundin Petroleum LUPE:SAX - Russia - Lagansky Putin is to all intents and purposes starting to Nationalize the Russian oil sector and in this Sakhalin 2 is but one of a few indicators. The big heads up on this becoming a problem was when Sakhalin 2 was halted due to environmental considerations. Anyone who knows the Russian resource industry knows environment is the least of their worries. As to what this really means for Lagansky is today hard to say yet I would put up a big Caution Sign on this one. Over the coming year leading up to the Presidential elections in December 2007 look for more "strong man" tactics from Putin. In this Lagansky while huge in potential may be small enough on the large stage to come in under the radar... 11/12 GMT 22.36 Tenke Mining - TNK:TSE - Tenke Fungurume Nice volume.. I know it takes awhile for the facts to sink in. 11/12 GMT 22.34 Lundin Petroleum LUPE:SAX - Russia - Lagansky Shells Sakhalin 2 is not good news for Lupe. More later... 6/12 GMT 21.46 Tenke Mining - TNK:TSE - Tenke Fungurume Finally! Financing will be the next issue, look for a well placed PP... The conditional approval is just a formality, you do not start this ball rolling unless you know where it is going. 6/12 GMT 19.55 Cricket - The 2006/2007, 73rd Ashes Series Speaking of a Spanking! After Perth it will all be over... *G* 6/12 GMT 15.30 Oil USA - Statistics from the DOE - API Crude - 1.1 mmbls (API - 4.1 mmbls) Gasoline - 1.1 mmbls (API + 0.67 mmbls) Distillates - 0.4 mmbls (API - 1.5 mmbls) Natural Gas - 11 bcf Crude Import 10.0 mmbopd Gasoline Imports 0.9 mmbopd Refineries 90.5% + 2.4% Gasoline Demand 9.3 mmbopd Distillate Demand 4.3 mmbopd Total Petroleum Inventories - 4.2 mmbls Refiners are the reason for the drop in Crude... Still good demand for Gasoline pushed down the numbers. Refiners..! Actual Heating Oil declined again. 5/12 GMT 23.12 Tanganyika Oil - TYK:TSX - TYKS:FN I can only reiterate a Strong Buy on this stock. Yet remember what I wrote that until the Independent Evaluation of the Syrian Reserve is in all else is speculation. Q1 2007... 5/12 GMT 15.30 Oil USA - Statistics from the DOE - API 6/12 15.30 GMT I expect, Crude + 1.5 mmbls Gasoline + 1.0 mmbls Distillates - 1.0 mmbls Natural Gas - 15 bcf Crude Import 9.9 mmbopd Gasoline Imports 1.0 mmbopd Refineries 88.4% Gasoline Demand 9.1 mmbopd Distillate Demand 4.4 mmbopd Another week with still no real winter will take itīs toll. Last weeks API stats for Distillates could be a heads-up. 4/12 GMT 22.50 Oman The Sultanate of Oman set its November oil price at $56.3 pbo up $0.09 from October. A statement by the Ministry of Oil and Gas said the month of November saw many factors and developments that resulted in fluctuation in prices. High supply of crude compared to demand, the statement said, particularly in Asian markets, and the increase in US stockpile are among the leading factors behind the flux. Oman sets the price retroactively. The Sultanate is not a member of OPEC. It currently produces about 752.000 mbopd. 4/12 GMT 11.53 OPEC - Production Reductions OPEC is in a bit of a quandry coming up to the Dec 14th meeting as if they do cut production this will not take effect until January/Feburary 2007. Just as we are heading into Q2 which is a slower demand quarter anyway. OPECīs president has again today pointed to the overflow of crude supplies and waining demand. That Europe is 3% over supplied is up to debate as there are no real time stats on Europe as a whole. The US is well known however. Plenty of mixed signals as usual. Range bound crude at $57 to $63... 3/12 GMT 17.48 OPEC - Production Reductions Iran has on Sunday called for further cuts in production by between 500.000 mbopd and 1.0 mmbopd. This then to be decided at the December 14th meeting. Again words but on the groung OPEC is cheating and some members are openly against cuts, due to the fact that at the current oil price they are making huge profits even with a falling dollar. NONOPEC welcomes every OPEC production cut with open arms as it means that countries like Russia are continually given top dollar for their crude. Add to this, "We're working for a stable and acceptable price of oil that will not only please the producers but be affordable to the consumer," Prince Turki al-Faisal, Saudi Ambassador to the US said on CNN's Late Edition show. "Our added concern in Saudi Arabia is for the poor countries who cannot afford US$70 a barrel for oil. Those are the countries that we would like to see benefit from price stability and an acceptable price range," he said. And Libya for itīs part calling for an end to reductions... 2/12 GMT 04.34 Greywolf.SE in your Mobile Phone From now on I will post time sensitive posts on a very low graphics page that can be read in your mobile. The information will be breif. Please bookmark www.greywolf.se/mobile.html in your mobile phone. 2/12 GMT 00.18 USA - ETF - United States Oil Fund USO Almost 10% in 9 days.. This ETF is easy enough to track that it should be called - Oil Investing for Dummies.. Well perhaps not as it is a game to call the market yet the USO has due to itīs nature been a very good indicator as to where the cash is putting itīs faith. Cash is King after all. Everytime! And in this you get the Real Time mood of the market and in this a broader view than just the actual contracts.. 2/12 GMT 00.06 OPEC - Production Reductions (updated) So it turns out as I projected that OPEC could only manage to cut just over 50% or 685.000 mbopd of that which was said in November ie 1.2 mmbopd. With the US on the brink of a serious economic slowdown I doubt that December will see a larger reduction if any at all this despite OPECīs words during the week. Actually Saudia Arabias words.. In this Saudi Oil Minister Ali al-Naimi said markets were "significantly" oversupplied, a signal the OPEC heavyweight may favor a further cut to output at the group's December meeting. "Inventories in the U.S. are high, not low ... That's why the market is out of balance," he told reporters in Cairo. "It will take 100 million barrels out of the market to achieve balance." For anyone who has read this site for awhile this is what I have been saying repeatedly, that the world is well supplied with oil even overly so. Yet OPEC knows very well if the inbalance continues it will ultimately hurt the whole oil market. IE I do not foresee any further cuts in production. Confused?... I will clear the picture so to speak later..... 1/12 GMT 17.36 OPEC - Iran Irans current daily production of oil is about 4.0 mmbopd actually it is 3.9 mmbopd. This then is 5% below the countrys OPEC quota. Iran has 137 billion barrels in oil reserves second only to Saudia Arabia and perhaps Iraq and when it comes to natural gas it is again second this time to Russia. Yet the country is literally running out of oil, not because of any Peak Oil nonsense but rather because the pipes are rusty and the rigs lack new parts and investment is running at about 30% of what is actually nedded just to keep the ship afloat. Iran is sitting on a huge potential that is scwandering away due to the countrys political/religous regime. Did you know that before the Islamic Revolution Iran produced 6.1 mmbopd.. This then back in 1974. Since then sanctions and a serious lack of technology have brought the oil sector in to huge problems. Especially as a large part of the oil infrastructure was put in place in the 1920īs and 30īs.. I kid you not! 1/12 GMT 11.39 Tanganyika Oil - TYK:TSX - TYKS:NMG (corrected) A Strong Buy! To round off the current thinking on TYK I would like to point out that my view of this company and the stock is to put it mildly - Extaticly Positive. If you love your wife donīt buy her lingerie for Christmas buy her a couple hundred TYK... If you donīt love your wife then buy the mistress lingerie... Because if you buy her TYK she will leave you sooner than you think, independently wealthy.. *G* Seriously... TYK will farm out part of the Syrian operations to someone who has the infrastructure, is in Syria today and is buying as much heavy oil reserves as it can get itīs hands on globally.... CN.... Egypt as I have stated before is hanging on a loose thread unless the techniques learnt in Syria can be applied there. As for the stock well at just this moment in the space continuum I am accumulating this one big time. Enough said. 30/11 GMT 21.28 Greywolf.SE in your Mobile Phone From now on I will post time sensitive posts on a very low graphics page that can be read in your mobile. The information will be breif. Please bookmark www.greywolf.se/mobile.html in your mobile phone. 30/11 GMT 20.56 Oil - VLCC Freight Rates Very low activity in the Middle East are keeping rates low... As of the 27/11 rates are below $40.000... 30/11 GMT 08.30 Tanganyika Oil - TYK:TSX - TYKS:NMG TYK is a minow in the oil world but it has had the good fortune by way of smart people doing smart things to find itself with what amounts to a potentially huge oil Reserve. The company sayīs the STOIIP could be as much as 25 billion barrels. All this ofcourse is just speculation prior to an actual independent Reserve evaluation.... Tanganyika Oil has after the private placement about 56 million shares outstanding, which is not a lot given that many upstreamers in need of cash constantly emit new shares. TYK has done so very sparingly through the years and thus the 6 million shares emitted last week made no difference at all to the share price. Quite the opposite. TYK also has a current production which by way of the ongoing EOR is set to increase substantially going forward. As with the STOIIP estimate and ultimately a Reserve evaluation the full result of the EOR is today still not fully known. Yet both will err heavily to the upside.... The Syrian PSA runs for 25 + 5 years so there is a lot of oil to be taken care of in 30 years and if you have any basic knowledge of Geology and Oil itīs easy to see that at the current production rates to make more than a dent in the reserve is going to be tough. Given 30 years is a long time and technology chugs along making advancements all the time and evenso in the oil patch. Yet development of the Syrian field is going to cost and the setup today with trucks ferrying oil to market is just not sustainable in the long run. So you have a minow sitting on a huge catch that is going to cost to develop - what to do? Until the independent audited report on the actual bankable P1 Reserves comes in itīs all speculation. When the company has the report in its hands - then you have a price tag. And in this the price per share of yesterdays close of 113.50 SEK in Stockholm $18.50 in Vancouver just aint going to cover the value, not by a long, long shot. Now letīs talk about China and especially one Oil company - CNPC.... And also Petro-Canada... 29/11 GMT 15.30 Oil USA - Statistics from the DOE - API 15.30 GMT Crude - 0.3 mmbls (API - 0.85 mmbls) Gasoline - 0.6 mmbls (API - 2.4 mmbls) Distillates - 1.0 mmbls (API + 3.5 mmbls) Natural Gas - 32 bcf Crude Import 9.8 mmbopd Gasoline Imports 0.95 mmbopd Refineries 88.1% + 1.0% Gasoline Demand 9.2 mmbopd Distillate Demand 4.4 mmbopd Total Petroleum Inventories - 7.5 mmbls Again within Distillates the actual Heating Oils declined. Other than that I did say this was an ambivilent week. Crude dropped for the first time in over a month, five weeks to be exact. But dont forget the stronger Refinery numbers.. Natural Gas storage took a dive yet the total storage is close to maximum.. 29/11 GMT 15.22 Tanganyika Oil - TYK:TSX - TYKS:NMG And now for the bits. Argentina Gold.. Remember that Lundin Company? They struck gold in Veladero in the 90īs as it turned out it was a multi-million ounce gold deposit. Homestake who in 1999 bought the company paid I recall $8.75 per share, just before the discovery Argentina Gold traded at around $0.26... Why did Lundin sell, well it would cost too much for the minute company to develop the discovery. So what does this have to do with Tanganyika Oil you ask. More later... 28/11 GMT 22.14 Tanganyika Oil - TYK:TSX - TYKS:NMG So did yīall see the "bits"? More later... 28/11 GMT 21.59 Oil USA - Statistics from the DOE - API at 29/11 15.30 GMT I expect, Crude + 1.5 mmbls Gasoline + 1.5 mmbls Distillates + 1.2 mmbls Natural Gas - 15 bcf (corrected) Crude Import 10.0 mmbopd Gasoline Imports 1.2 mmbopd Refineries 87.8% Gasoline Demand 9.3 mmbopd Distillate Demand 4.4 mmbopd Total Petroleum Inventories + 4.0 mmbls The Alaska Pipeline should give lower imports and an increase in Refineries will pull down the Crude stocks. Warm weather in the US means less use of Distillates and Natural Gas. Evenso I see this weeks stats so ambivilent that they can swing across the board. Last weeks high Crude storage and Imports where the big surprises. Maybe so again.. 27/11 GMT 21.48 Tanganyika Oil - TYK:TSX - TYKS:NMG Look for some interesting "bits" to turn up at the Stockholm Presentation 28/11. 24/11 GMT 19.18 Tanganyika Oil - TYK:TSX - TYKS:NMG The private placement, of up to an aggregate of 6 million common shares at a price of CDN $15.91 / SEK 97 per share for gross proceeds of up to CDN $95.4 million / SEK 582 million is a damned good idea.. *G* This would bring the fully diluted share position to 56,915,696 shares. The company is going to need the funds to develop Syria, the very interesting Syria.. Also TYK has always had a relativelly small share position given the projects it has sought to go for. I find it odd that the company had to defend itīs decision to place the PP right now, after a lot of good news has been put forward. Well hell if you are going to sell something you wax it up, trim what needs to be trimmed and show the product in itīs best light. After all itīs just good business sense... And today TYK has a lot to show off with. The independent evaluations of the reserve upgrade are going to be very interesting indeed. 23/11 GMT 12.22 Tanganyika Oil - TYK:TSX - TYKS:NMG Smokin! And not without reason.... 23/11 GMT 10.51 Tanganyika Oil - TYK:TSX - TYKS:NMG - Syria - Oudeh - Tishrine 22/11 GMT 11.35 Canmex Minerals Corporation - CXM.V - Somalia In October this Lundin company signed a Memorandum of Understanding MOU to acquire an 80% interest in licenses covering the highly prospective Nogal and Al Medo/Darin basins in the state of Puntland in northern Somalia. The MOU has been signed with Range Resources Ltd - RRS:ASX. Range has published an independent report on Puntland, to be found below. 22/11 GMT 17.37 Sudan - Nile Blend Crude Of interest to those who follow Lundin and White Nile.. Sudanīs, Sudan Petroleum Corp has sold 1 mmbls Nile Blend crude oil to Japan for January loadings at a price $2.70 below Minas Crude, the Indonesian grade of Crude. Minas today trades at around $52.50. 22/11 GMT 15.41 Oil USA - Statistics from the DOE - API at 15.30 GMT Crude + 5.1 mmbls (API - 1.7 mmbls) Gasoline + 1.4 mmbls (API - 0.8 mmbls) Distillates - 1.2 mmbls (API - 1.4 mmbls) Natural Gas - 1 bcf Crude Import 10.5 mmbopd Gasoline Imports 1.2 mmbopd Refineries 87.1% Gasoline Demand 9.3 mmbopd Distillate Demand 4.4 mmbopd Total Petroleum Inventories + 3.8 mmbls Despite LOOP having to close during the measured period Imports where up. We will call this report market neutral/negative. Yet with a long weekend in the US and the problems with The Trans Alaska Pipeline looming... Natural Gas fell less than expected, warm weather. In this Distillates or the Heating Oil part and Natural Gas play off each other. Actual Heating Oil only saw a small draw in storage much less than Distillates as a whole. 22/11 GMT 00.21 Oil USA - Statistics from the DOE - API at 15.30 GMT I expect, Crude + 2.1 mmbls Gasoline - 1.3 mmbls Distillates - 1.5 mmbls Natural Gas - 10 bcf Crude Import 9.0 mmbopd Gasoline Imports 1.1 mmbopd Refineries 87.5% Gasoline Demand 9.3 mmbopd Distillate Demand 4.5 mmbopd Total Petroleum Inventories - 4.0 mmbls Look for the problems at LOOP to show up this week hence the low import expectation. The milder weather of late did not take anything out of the Distillates in the prior weeks stats and Gasoline demand looks set for the same level. The Trans Alaska Pipeline has been having problems yet this is for next week. 20/11 GMT 09.41 This Week OPEC, the North American weather and the DOE/API Stats... The statistics are going to be more and more the driver for the contracts as storage levels for Distillates have decreased of late. OPEC well what do you say!? 19/11 GMT 19.17 OPEC - Algeria Algerias Energy Minister Chakib Khelil said on Algerian public radio Sunday that OPEC is contemplating further cuts in their December meeting. This just proves how twisted OPEC is today. Algeria is one of a group of countries that did not partake in the first cut of 1.2 mmbopd. This country is now saying further cuts are on the way. OPECīs credibility is surelly being tested to the hilt.... 17/11 GMT 11.30 Oil - The contracts So how far can they fall? Well probably pretty far as hedge funds and instituitions are getting out and some have lost big bucks of late on oil so they will not go back in in a hurry. That this retreat is welcomed is another thing. The sector needs a good clean out. 16/11 GMT 22.52 USA - Louisiana Offshore Oil Port - LOOP Next weeks DOE stats will be skewed again by LOOP having been off line this week for three days.... Interruptions are common this time of year and this was the fourth in four weeks due to bad weather. 16/11 GMT 22.52 Oil - The contracts Huge fall in Thursdays trade and itīs down to two things OPEC and the weather.. OPEC just arenīt going to get the cuts they talked about I donīt even see my estimate of 600.000 mbls being actually cut. It is even more than possible that we may see a small build in supply from OPEC in December. Warmer weather and a projected warm winter in the US is the other reason. The US is well supplied with oil and sooner or later this shows up in the stats and in the price. Also December NYMEX contracts expire on Friday.... 15/11 Oil USA - Statistics from the DOE - API at 15.30 GMT Crude + 1.3 mmbls (API + 6.7 mmbls) Gasoline - 3.7 mmbls (API - 1.4 mmbls) Distillates - 3.6 mmbls (API - 2.3 mmbls) Natural Gas + 5 bcf Crude Import 9.5 mmbopd Gasoline Imports 1.1 mmbopd Refineries 87.3% -0.8% Gasoline Demand 9.3 mmbopd Distillate Demand 4.5 mmbopd Total Petroleum Inventories - 9.0 mmbls As Refiners back off Crude supplyes rise yet imports where down so the picture can be viewed differently. Total crude and products have dropped 16.5 mmbls over the last four weeks. Gasoline demand is 3.5% above last years level. 14/11 GMT 19.42 - Postings I apologize for temporarily lost postings during the last few days, they should now be up again. I am going back to timing the post in UTC or more commonly known GMT and if I have changed the material a Corrected or Edited notice will be added to the subject heading. Date and time is GMT. 14/11 Oil USA - Statistics from the DOE - API at 15.30 GMT 15/11 I expect, Crude + 2.0 mmbls Gasoline - 0.8 mmbls Distillates + 0.5 mmbls Natural Gas + 15 bcf Crude Import 10.0 mmbopd Gasoline Imports 1.0 mmbopd Refineries 88.8% Gasoline Demand 9.4 mmbopd Distillate Demand 4.3 mmbopd Total Petroleum Inventories + 1.5 mmbls Warmer than normal weather should show up in the Distillate numbers yet even so demand has been up so we could see a fall of about the same amount I expect to go the other way. 14/11 Lundin Petroleum LUPE:SAX - Tunisia - Oudna Up and running... Initial production is 8000 bodp which is set to climb to 20000 bopd. 14/11 Iran - Nuclear soon? President Mahmoud Ahmadinejad on Tuesday said Iran would soon celebrate completion of its controversial nuclear fuel program. "With the wisdom and resistance of the nation, today our position has stabilized. I'm very hopeful that we will be able to hold the big celebration of Iran's full nuclearization in the current year," - Ahmadinejad Iran's current calendar year ends on March 20. 14/11 Lundin Petroleum LUPE:SAX - Sudan - Rumour Gustaf Tapper who writes for the rag Dagens Industri is perpetuating an old rumor and that someone at Netjets has an opinion on block 5b in the Sudan. Netjets make executive aircraft as far as I know... 13/11 Lundin Petroleum LUPE:SAX - Ethiopia - Ogaden Basin Somali State The Ogaden National Liberation Front ONLF was founded in 1984 and is dedicated to restoring the rights of Somalis in Ogaden to self-determination, peace, development and democracy.... (Their statement) Well revenue from oil production and the help that companies like Lundin Petroleum can give in local assistance should not be frowned apon... 13/11 Lundin Petroleum LUPE:SAX - Q3 Report 15/11 I expect, Operating Income 1.200 million SEK Net Profit 325 million SEK 13/11 OPEC - Saudi Arabia Saudi Arabia who is taking the brunt of the OPEC cuts has through Aramco informed Asian customers of further cuts in supply for December. Two Japanese refiners have been notified to expect a 4% cut in supply, this then half of the November cut of 8%. Refiners in South Korea and India will experince no cuts at all compared to November and some other Asian refiners may even see a samll increase in supply volumes. Kuwait for itīs part is exporting all the oil it can to Asia and other customers. OPEC fluffing it, again. 13/11 Israel - Oil Shale I posted on the 7/7 about a new technique to extract oil from oil shale... An update. 12/11 Oil - VLCC Freight Rates Not much movement in the freight rates.. Or.. 12/11 OIL - The Contracts Pretty flat over the last period. Much like old days when you really had to trade to make a buck not just follow the sheep. The contracts have been range bound despite Geopliticals, OPEC cuts etc which says they are bound to break one of two ways - Up or Down. Ainīt I smart!? Warmer than usual weather in the US, OPEC fluffing it, the Democrats retake the US Senate and the House, Iran coming up to a point where rhetoric is going to become reality on the ground. We are entering a very interesting period, interesting indeed. The demand numbers especially for Gasoline and Distillates from the US of late do give support to the oil price yet if OPEC is cheating and NONOPEC is cashing in on a good thing we could be set for the "Ketchup Effect" so common to commodities ie - Nothing fixes the high price of a commodity like the high price of a commodity..... 12/11 OPEC - NONOPEC Well as expected! and it did show up in the contracts on Friday NONOPEC is going dambusters and at the current oil price they will continue to do so. Even the IEA concur, with NONOPEC production thought to grow by 1.78 mmbpd to 52.7 mmbpd in 2007. With OPEC far from compliance on present cuts and NONOPEC producing to the hilt I see 2007 as being a very interesting year as far as trading in oil goes. Beware all those who think oil is just simply "going North dude". It ainīt that simple in the oil patch... 11/11 Lundin Petroleum LUPE:SAX - Ethiopia - Ogaden Basin Somali State The Ogaden Basin exploration history dates back to 1920 pioneered by Standard Oil Company that first carried out a geologic survey. Since then 14 companies had taken concession and conducted exploration surveys and mapping. Tenneco, an American company at a depth of 3732 meters, discovered natural gas in 1972. The second gas reserve found in Hillala locality is estimated to be 42 billion cu.m. The Hillala gas reserve was discovered by a Russian company, Soviet Petroleum Exploration Expedition. To date Ethiopia has no production of oil or gas. The Calub and Hilala areas of the Ogaden basin, are thought to contain 4 trillion cubic feet of gas and 13.6 million barrels of associated liquids. Block 2 and 6 are located just west of the Calub and Hilala oil and gas discoveries. So is there oil in Ethiopia? Well there are good indications there are as there are oil seeps, ie oil coming up out of the ground in many places. This then true for Somalia which borders the Ogaden Basin. Yet neither country has today any oil production.. Lundin Petroleums forage into Ethiopia is done through Lundin East Africa BV, Netherlands. Yet again a smart move to put a risky but potentially very profitable venture into a wholly owned subsiduary. The Lundin way... 11/11 OPEC - Production Cuts I will stick to my belife that 600.000 mbopd is what OPEC actually will cut in November. Please note that Nigeria the first country out to follow the cuts is actually producing between 50.000 to 100.000 mbopd more than before the new quotas.. 8/11 Oil USA - Statistics from the DOE - API at 15.30 GMT Crude + 0.4 mmbls (API - 0.9 mmbls) Gasoline - 0.6 mmbls (API + 1.3 mmbls) Distillates - 2.7 mmbls (API - 2.1 mmbls) Natural Gas - 9 bcf Crude Import 9.8 mmbopd Gasoline Imports 1.0 mmbopd Refineries 88.1% - 0.8% Gasoline Demand 9.4 mmbopd Distillate Demand 4.4 mmbopd Total Petroleum Inventories - 6.8 mmbls 5/11 NONOPEC - OPEC - Oman Oman will not cut itīs production according to Oman's Petroleum Minister Mohammed Al Ramhi.. Algeria and Indonesia have also not proposed cuts in production. After having viewed the situation over the last few days I would be surprised if we see more than 600.000 mbopd being taken off the market by OPEC. 5/11 Investment Fund - In Memory of Adolf Lundin I will put up a post on this matter shortly. For those who read Swedish info can be found at www.aktietips.com search for Svempa.. 3/11 OPEC - Production Cuts - Kuwait Well it only took two days for decension to rear its ugly head. Kuwait is getting cold feet, already.... Kuwait calls for a hold on further cuts... 2/11 OPEC - Production Cuts Increasingly it looks like Asia will continue to get all the crude it wants from its OPEC sources in this a large part of Middle Eastern crude goes to Asia. The proposed cuts made by Saudi Arabia, UAE, Iran, Kuwait are all for loadings to Europe and other regions and the cuts are centered on spot deliveries. In this I donīt see the current actual cut if implemented of 966.000 mbopd making much of a dent in the price of oil. Firstly because the cut is not the 1.2 mmbopd that OPEC announced and secondly I say itīs just OPEC adjusting itīs actual production to the real on the ground demand. Sorry folks but OPEC I fear have dropped the ball on this one... 1/11 OPEC - Iraq Iraqs oil production reached an average of 2.3 mmbopd in October, with exports amounting to 1.6 mmbopd despite terrorist actions. 1/11 Oil USA - Statistics from the DOE - API at 15.30 GMT Crude + 2.0 mmbls (API + 3.5 mmbls) Gasoline - 2.8 mmbls (API - 3.2 mmbls) Distillates - 2.7 mmbls (API - 0.75 mmbls) Natural Gas - 9 bcf Crude Import 10.1 mmbopd Gasoline Imports 1.2 mmbopd Refineries 88.9% + 2.7%! Gasoline Demand 9.4 mmbopd Distillate Demand 4.1 mmbopd Total Petroleum Inventories - 3.4 mmbls Crude saw less of a build due to the + 2.7% increase in Refinery Output. Gasoline demand was 4% above last years level and this then reason for the draw on stocks. As far as Distillates is concerned Heating Oil only dropped by - 1.5 mmbls. Distillate demand has been brisk with a 9% increase year on year, stocks of all products are well above average for the year. With refiners back online after work-overs I see this report as fairly market neutral to negative. Crude storage is in this 12% above the 5 year average, with Distillate storage 13% above the 5 year average. The LOOP effect could be delayed by a week as the APIīs numbers seem to indicate. 1/11 Oil US Energy Independence a "dream" - Saudi oil executive A senior Saudi oil official warned Monday the notion that the United States could become energy independent was "only a dream" in the modern globalised economy. Khalid Al-Falih, senior vice president of state-owned conglomerate Saudi Aramco, made his remarks as US addiction to foreign oil reverberated along the campaign trail before legislative elections next week. His warning was endorsed by top executives of US oil companies, which sponsored a daylong program on crucial US-Saudi ties at the annual conference of the National Council on US-Arab Relations, a private outreach group. "Certainly, the notion of 'energy independence' is an attractive one at first glance and is very popular," Al-Falih said, but warned that in the global economy "the costs of pursuing the path of energy self-sufficiency would be high." He criticised the view that new alternative fuels could wean the United States off foreign oil, much of it produced in volatile parts of the world. Despite impressive growth rates, renewable energies would only hit 6% of the world's total energy supply by 2030. With no substitute available for jet fuel, gasoline and diesel, oil would "remain the dominant fuel for the forseeable future". "Since domestic US production continues to gradually decline while US oil demand is rising, the prospect of self-sufficiency in oil is growing ever more remote." Al-Falih said no country could insulate itself from fluctuations in world oil prices and demand, saying more, not less globalization of the market was needed, along with transparency of production, consumption and capacity data. "Oil markets are global in nature, crude oil is a fungible commodity, and those two realities mean that energy independence in its literal sense of self-sufficiency can only be a dream, while energy interdependence is the reality." US politicians from across the political spectrum, including former president Bill Clinton, have promoted energy independence on the campaign trail as a way of protecting the United States from costly and bloody foreign wars to secure energy supplies. 1/11 Oil USA - Statistics from the DOE - API at 15.30 GMT I expect, Crude + 4.0 mmbls Gasoline - 1.0 mmbls Distillates + 1.5 mmbls Natural Gas - 10 bcf Crude Import 10.5 mmbopd Gasoline Imports 1.0 mmbopd Refineries 86.8% Gasoline Demand 9.3 mmbopd Distillate Demand 4.3 mmbopd Total Petroleum Inventories + 6.5 mmbls Hard to call this week as the 70 hour stopage at LOOP put a spanner in the works last week. Yet Crude will see a build and the rest is Refinery driven. I have a feeling we could see a build across the board... (Please note I have corrected the initial post.) 1/11 Asia - Strategic Petroleum Reserves South Korea has signed an agreement with Kuwait for joint storage for South Koreas SPR. The deal adds 2.0 mmbls to the 25 mmbls already in storage, which equals about 13 days of consumption. The goal is for 40 mmbls of storage to be reached by 2010. China has also started to fill itīs SPR which will have a capacity of 102 mmbls by 2008. The total of the Chinese reserves 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. 31/10 Tanganyika Oil - TYK:TSX - TYKS:NMG - Syria - Oudeh - Tishrine - EOR So anyone unhappy with the EOR result, I think not! *G* Look for the Presentation by Mr Guidry at the, Where Mr Guidry is set to speak at 8.40 am Dubai Time on Wednesday Nov 1. Go to the Web Cast Link... 31/10 Tanganyika Oil - TYK:TSX - TYKS:NMG - Syria - Oudeh - Tishrine - EOR Look for a press release shortly.. 30/10 OPEC - NONOPEC OPEC is even before Nov 1 starting to make sounds about further production cuts. If the current 966.000 mbopd is taken off the market in November well then it will take between 2 to 6 weeks for this to fully show up in the system, as loadings to Asia, Europe and the US take about this time. That is if all the cuts are made by Nov 1, which they will not be. The thing is though that NONOPEC producers like Russia, always see an OPEC cut as a chance to earn a bit extra and with the high price of oil of late a lot of NONOPEC investment has been put into increasing production. Canada and Mexico so important to the US are not set to cut production for instance.... OPEC meet again on December 14 and by then the full extent of the current cuts will be more than clear. The problem for OPEC today is that it does not have a strong leader. When Sheikh Zaki Yamani ran the show the world listened, today much if not all of the contact with OPEC is through individual member countries oil ministers. OPEC is in some ways more and more becoming an anachronism and itīs the members that are the problem. Who for instance takes Hugo Chavez seriously?.... If OPEC can not actually cut the stated 1.2 mmbopd this time itīs already tarnished reputation is well tarnished more. 30/10 Oil The Contracts I donīt see the contracts heading north just yet. The DOE/API stats this week will show storage increases, again. OPEC is still the x-factor as they have stated that the reductions will start Nov 1, but in this the proof is in the pudding and only time will tell if they actually do cut. So far 966.000 mbopd are said to come off the market this then not the 1.2 mmbopd initially stated. The USA is set for a warmer than normal winter and so far there have been no big geopolitical happenings to threaten supply... 30/10 Iraq - Petrel Resources PLC - PET:LSE - Berlin Börse PQ4 The company had a deal with Saddam Husseins government regarding Block 6 in the Western Desert.... Also David Horgan is a pretty cool customer... 29/10 OPEC - Production - Quotas With OPEC on the Reduction Road it could be interesting to note the actual Production vs the Quotas, as of September 2006.. Production Quota Algeria 1.4mmbopd 0.9 mmbopd Indonesia 0.9 mmbopd 1.45 mmbopd Iran 3.75 mmbopd 4.11 mmbopd Kuwait 2.6 mmbopd 2.25 mmbopd Libya 1.7 mmbopd 1.5 mmbopd Nigeria 2.2 mmbopd 2.3 mmbopd Qatar 0.85 mmbopd 0.73 mmbopd Saudi Arabia 9.2 mmbopd 9.1 mmbopd UAE 2.6 mmbopd 2.44 mmbopd Venezuela 2.45 mmbopd 3.22 mmbopd OPEC 10 27.64 mmbopd 28.00 mmbopd Add Iraqīs 2.0 mmbopd and the OPEC 11 are today producing pre-cuts 29.64 mmbopd. 29/10 Tenke Mining - TNK:TSE Election Day in the DRC... 28/10 Iraq... With most Western Oil Companies giving Iraq a wide berth due to the ongoing violence, China steps up and is reviving a $1.2 billion deal signed by Beijing and Saddam Hussein's government in 1997 to develop the al-Ahdab field. Norwayīs DNO is one of the few Western companies that have actually gone into Irag, in this case the Kurdish North. Yet if China is able to invoke old deals, and most if not all the Western majors do not want to partake well then there is one company based in Sweden that is well known for going full pelt into the breach and unpopular places.... *G* Iraq's Western desert is an awfully interesting place.... 28/10 Oil - VLCC Freight Rates Current day rates for modern VLCCīs run at $53,651... With warm weather, large Crude storage and an OPEC production cut the pressure is on... The last 10% up-turn looks set to become a down-turn.. 28/10 OPEC - Venezuela Venezuela says it will cut 138.000 mbopd from its production. Of this today only 50.000 mbopd has actually been taken off the market and Venezuela is the member that you trust the least. Given that the country does cut the said amount then the total OPEC cut comes in at 966.000 mbopd... 27/10 Tanganyika Oil - TYK:TSX - TYKS:NMG - Egypt - West Gharib Block I wrote earlier on 13/10, that a structural deal is on the way.. I donīt see the West Gharib Block being part of Tanganyika Oil for too much longer. West Gharib saved Tanganyikas bacon after the exodus from Tanzania but there are bigger and better fish to fry going forward. 27/10 OPEC - Libya Libya says it will cut 72.000 mbopd from its production. So this then added to the OPEC total gives cuts of 828.000 mbopd... Libyas OPEC quota is 1.5 mmbopd and its current production is 1.7 mmbopd, so even here a little less "cheating".... 27/10 OPEC - Kuwait Kuwait has adviced its customers that it will cut 100.000 mbopd in production.. So that is also to be added on to the 656.000 mbopd already announced by UAE, Iran and Saudi. OPECīs actual cut to date 756.000 mbopd.... Kuwait currently produces 2.6 mmbopd, compared with its OPEC quota of 2.25 mmbopd. Kuwait is therefore simply "cheating" less than before.. Yet again the cut is made from current production. 27/10 Tanganyika Oil - TYK:TSX - TYKS:NMG - Syria - Oudeh - Tishrine Look for results from the Enhanced Oil Recovery "EOR" operation in Syria to be, well letīs conservativly call it optimistic.... 26/10 Oil The Contracts I did mention temporary as the up-tick for the contracts is just that as the fundamentals still are market negative for Crude. OPEC has to date only, as I have pointed out cut production by half the 1.2 mmbopd it mentioned. US storage of Crude and products is ample as are Asian and European storage levels. Unless we get a major problem with supply the oil price is set for a decline with temporary up-ticks due to short term effects. For instance the US Crude import numbers where affected by a 72 hour stopage at LOOP, hence the weak stats... Look for next weeks DOE - API stats to show builds.. Also dont forget that actual Heating Oil saw an increase.. Look a bit further than the headlines! 25/10 OPEC - Iran Iran has adviced its customers that it will cut 176.000 mbopd in production.. So thatīs to be added on to the 480.000 mbopd already announced by UAE and Saudi. OPECīs cut to date 656.000 mbopd.... The cuts are being made from current output rather than nominal quotas. Iran’s OPEC quota is 4.11 mmbopd but its actual output in September, was 3.88 mmbopd. 25/10 Oil USA - Statistics from the DOE - API at 14.30 GMT Crude - 3.3 mmbls (API - 3.7 mmbls) Gasoline - 2.8 mmbls (API - 2.3 mmbls) Distillates - 1.4 mmbls (API - 0.6 mmbls) Natural Gas + 19 bcf (26/10) Crude Import 9.5 mmbopd Gasoline Imports 1.0 mmbopd Refineries 86.2% -0.1% Gasoline Demand 9.3 mmbopd Distillate Demand 4.3 mmbopd Total Petroleum Inventories - 11.3 mmbls Ouch way off on the Crude estimates. This should set the contracts alight! A fairly market positive report. The thing to watch is that the storage levels of actual heating oil ie the high-sulfur distillate fuel increased by + 0.7 mmbls. Crude took a beating due to the lower import numbers. Ouch way off on the Natural Gas storage which is at a record 3.5 trillion cubic feet.. Hell is going to have to freeze over soon if Natural Gas prices are going to do more than just trade within the range. 25/10 OPEC - United Arab Emirates The UAE makes the stars shine for the contracts in the after hours trade, temporarily... So OPEC now has 480.000 mbopd commited to cuts.. What did they say 1.2 mmbopd? Bit of a way still to go then. 25/10 Oil USA - Statistics from the DOE - API at 14.30 GMT I expect, Crude + 6.5 mmbls Gasoline + 2.0 mmbls Distillates - 1.5 mmbls Natural Gas + 60 bcf Crude Import 10.4 mmbopd Gasoline Imports 0.8 mmbopd Refineries 86.8% Gasoline Demand 9.2 mmbopd Distillate Demand 4.3 mmbopd Total Petroleum Inventories + 2.8 mmbls Refiners are down for seasonal work. The one to watch is Distillates which have dropped the last weeks by over 6.0 mmbls yet storage is till above average. Itīs all about Distillates. 24/10 OPEC - United Arab Emirates The UAE has told its customers that it will be reducing crude exports by 5% or 100.000 mbopd... 24/10 USA - ETF - United States Oil Fund USO Perhaps a slight up-tick today but this ETF has on the whole lost 24% since its inception. Short term trading though has been very good. New low yesterday... 23/10 Oil The Contracts Look for the contracts to keep heading south. As large Hedge Funds continue their selling and noncommercial positions, which mostly are funds, now have turned net-short for the first time since March... 23/10 OPEC - Saudi Arabia The Saudis are yet again to take the brunt of OPECīs cut, this time by 380.000 mbopd. Much of this ie 280.000 mbopd is taken off the Asian market with a reduction to Asian Refiners by about 8%. I suspect as the market at large does that this is the real OPEC cut this time. I have not seen any other member country publish their cuts that is actual reductions to customers. So OPECīs cut of 1.2 mmbopd becomes 0.4 mmbopd, the rest 0.8 mmbopd is what Iran, Nigeria, Venezuela etc are today not able for differing reasons to produce. 23/10 Sweden - Dacke Group Nordic - DACKB:FN The advice is again going forward to Accumulate. You will not be sorry... 23/10 USA - ETF - United States Oil Fund USO So whom do you believe? I see a new all time low. Yet with a close to $3 downturn last week, a short bounce... 22/10 Lundin Petroleum LUPE:SAX - Sudan Khartoum has expelled the UN envoy Jan Pronk. Pronk was given 72 hours to leave the country. He has never really been very popular with Khartoum and after he Webloged his opinions about the military on his website... UN personell are in this not allowed to publish their opinions in book form.. Someone forgot the Web. The Sudan People's Liberation Movement/Army (SPLM/A) are very "unhappy" because they where not consulted on this matter. Yasser Arman, the spokesman for the southern Sudanese government pointed to the fact that Pronk came to the Sudan as a result of the Comprehensive Peace Agreement (CPA) and that Khartoum is increasingly undermining the CPA. This could either be the beginning of something new or something far worse. I have stated which way I see this place going. 20/10 OPEC - Meeting in Qatar OPEC cuts 1.2 mmbpd and sayīs more to come. The next meeting is in December.. With countries like Iran, Venezuela, Nigeria already producing way below quotas itīs up to the Saudis to again take the brunt of the cut or just simply produce what they are today. The fact is that as the global economy is turning out OPEC would probably be comfortable with $50 oil at the moment. And as when OPEC does decide to adjust production it is done from necessity ie to bring it in to line with their current actual production. I dont see the oil price going north on this news... Recall that Mexico and Canada alone stand for 35% of US imports of oil and neither have said they will follow OPECīs "cuts". Reality - the US is still the single biggest customer of oil in the world so what happens there matters. 19/10 Lundin Petroleum LUPE:SAX - Tunisia - Oudna Production start any day now... 19/10 Lundin Petroleum LUPE:SAX - Sudan Again I say, get out of this one. Things are far, further from getting better. US sanctions and it seems even the otherwise impotent EU is getting in on the act. Sell the minority stake to the Chinese who dont give a hoot in hell and go find a better place. Or spin the Sudan off in a seperate non-US/EU company.... A thought. 19/10 OPEC - Meeting in Qatar If OPEC just hold to the 1.0 mmbpd cut then nothing is going to happen to oil price as this is already priced in, if they should put another cut on the table then we will see a reaction. Yet I think not... Update.. "Saudi Arabia Says OPEC to `Absolutely' Cut 1 Million Barrels. Oct. 19 Saudi Arabia Oil Minister Ali Al-Naimi said OPEC will ``absolutely'' cut 1 million barrels a day of oil to stem a fall in prices. The Organization of Petroleum Exporting Countries, the producer of 40 percent of the world's crude, will make the cuts from Nov. 1, al-Naimi said. Cuts should come from actual production, he said." I like the fact that "absolutely" has to be added to the statement. We will cut seems more than sufficient.. Even so as stated before this cut is already priced in even if the cut is from current production. 19/10 USA - ETF - United States Oil Fund USO Whatever OPEC decides it is already in the market in the contracts and in the USO. Yesterday saw fairly big volume just 9 cents above the ATL... I do not think we have hit bottom yet. 18/10 Oil USA - Statistics from the DOE - API at 14.30 GMT Crude + 5.1 mmbls (API + 8.0 mmbls) Gasoline - 5.2 mmbls (API - 6.1 mmbls) Distillates - 4.5 mmbls (API - 2.6 mmbls) Natural Gas + 53 bcf Crude Import 10.4 mmbopd Gasoline Imports 0.7 mmbopd Refineries 86.3% - 2.9% Gasoline Demand 9.2 mmbopd Distillate Demand 4.3 mmbopd Total Petroleum Inventories - 5.8 mmbls Gasoline imports where way down. Refinery output down again due to work-overs and a lowering of production due to decreasing margins. The Gasoline numbers are down due to the weak Refinery output and very low import, this then also true for Distillates. At a time when the US is well stored with Crude and product these numbers are fairly market negative. 18/10 Oil USA - Statistics from the DOE - API at 14.30 GMT I expect, Crude + 3.0 mmbls Gasoline + 0.5 mmbls Distillates - 0.5 mmbls Natural Gas + 60 bcf Crude Import 10.5 mmbopd Gasoline Imports 1.2 mmbopd Refineries 88.5% Gasoline Demand 9.1 mmbopd Distillate Demand 4.2 mmbopd Total Petroleum Inventories + 2.5 mmbls US crude oil inventories currently stand at 330.5 mmmbls. That is 14% above the five year average.... US crude imports rose 3.8% between July and August with Canada the major supplier followed by Mexico, Saudi Arabia and Venezuela.. 17/10 Oil The Contracts With OPEC out to lunch on production reduction and waining global expected demand by the same organisation, varmer but not as varm as last year weather in the US. Global economic slow down.. Itīs all up to OPEC. 16/10 USA - Oil the Contracts - Weather Traders on NYMEX are pondering Farmers' Almanac - which states that the winter of 2006/2007 will be cold and harsh... This then opposed to NOOA which seeīs this winter being warmer than normal though slightly below last years very warmer than normal temperatures.. Go Figure! 16/10 OPEC Again lowers itīs demand forecast... 16/10 Europe - Oil Companies Anyone employing the idea that the downward trend in the oil price is directly coupled to Oil Company shares might think again. During the oil price boom most Non-European oil shares did far better than the, Europeans. In this I belive there is a huge X-factor lurking in European Oil Shares. Simply because they have fallen too far from an already comparatively lower level than the rest of the oil patch... Think on this! 16/10 Iraq - DNO - DNO:NO Tawke-1 flow rate of 5.000 bopd achieved during open hole testing... 14/10 OPEC The organisation is set to meet on October the 19th. Yet this could be the most "non-event" ever as the indecision by OPEC to cut or adjust quotas by 1.0 mmbopd is already priced into the contracts. Its just OPEC being OPEC... Also OPEC has long ago lost itīs total leverage as if it does cut its production, NONOPEC oil becomes more viable. For example Canada is now the USAīs major source of oil. Canada has said it does not care one bit for OPECīs quota cuts. The fact is that the price of oil is not set by OPEC, NONOPEC or any lone body. It is set by the market and increasingly so. The world market of oil is well stored with product and any talk of a cut by OPEC is only going to increase the glut as everyone will be producing up to the new price level. At $60,$70,$80 a barrel even oil from Oklahoma Tar Pits looks attractive.. The old adage "Nothing cures the high price of oil like the high price of oil", still applies. Itīs a bit of a Catch 22... Itīs all a Question of Real Demand.... 13/10 Dacke Group Nordic - DACKB:FN The advice is going forward to Accumulate. There are similarities with the Lundin sphere where by you spread the risk over smaller companies only to bring them ultimately into the fold if they are successful.. What this company now needīs is a stock listing whereby capital can be infused. 13/10 Tanganyika Oil - TYK:TSX - TYKS:NMG Interesting times... Look for a structural deal, soon. 13/10 Lundin Petroleum LUPE:SAX - Lagansky - Drill start Q2 2007 As expected the drill start is delayed. Earliest spud date is in Q2, 2007 with two drilles planned. Ex VPC share owners should thank their lucky stars they now are holders of shares in Lundin Petroleum. 12/10 Oil USA - Statistics from the DOE - API at 14.30 GMT Crude + 2.4 mmbls (API + 0.9 mmbls) Gasoline + 0.3 mmbls (API - 2.5 mmbls) Distillates - 1.6 mmbls (API + 0.4 mmbls) Natural Gas + 62 bcf Crude Import 10.4 mmbopd Gasoline Imports 1.1 mmbopd Refineries 89.2% - 0.7% Gasoline Demand 9.2 mmbopd Distillate Demand 4.2 mmbopd Total Petroleum Inventories + 0.5 mmbls 11/10 USA - ETF - United States Oil Fund USO Trading this very close. Yet $50 is closer than $60... OPEC does not want to be the instigator of global slow-down. Hence oil is going to be plentifull. The trend! As I have pointed out.... 10/10 OPEC More of the - Fluff! Saudi Arabia has told Asian and Mediterranean customers to expect the same loadings of Crude in November as they are getting now. No cuts here! According to OPEC production during September increased by 0.04 mmbopd to 29.95 mmbopd. Most of this is down to Iraq, which is not actually part of the OPEC quota. These then are OPECīs numbers. Third party estimates on OPEC production actually show a decreasing production by 0.1 mmbopd to 27.91 mmbopd. 29.95 mmbopd as opposed to 27.91 mmbopd a difference of 2.0 mmbopd.... Its all down to whom do you - believe! 10/10 Oil USA - Statistics from the DOE - API 12/10 at 14.30 GMT I expect, Crude + 3.0 mmbls Gasoline + 1.5 mmbls Distillates + 1.8 mmbls Natural Gas + 75 bcf Crude Import 10.5 mmbopd Gasoline Imports 1.1 mmbopd Refineries 89.0% Gasoline Demand 9.1 mmbopd Distillate Demand 4.1 mmbopd Total Petroleum Inventories + 4.4 mmbls 9/10 OPEC I donīt buy the quota cuts as they are not cuts they are just a readjustment to the Reality on the ground. OPEC is today producing way below itīs quota.... The announced cuts are so far - Fluff! 9/10 North Korea - Iran - Nuclear If the bomb that was tested in North Korea actually was nuclear which is up for some debate then, the Mullahs in Tehran must be laughing themselfīs silly at the Impotence of the West and especially the UN for letting things get this far out of hand. Iran is I bet the next to test itīs "Bomb". That is after North Koreas second test? 9/10 Oil The Contracts - OPEC - North Korea Nothing like a new nuclear bomb? to pick the oil price right up. OPEC I think is less the reason as I still belive they are simply adjusting the quotas to their current in the real world output. 7/10 Oil The Contracts - OPEC OPEC as many others are looking at the bigger picture and in this, world oil demand is waining. The mixed signals from the organisation is a good indicator and as I have stated much of the talk is just that - Talk. OPEC knows that an oil price spike now would kill the global economy and therefore they are giving the market very diveresed comments, mostly to calm local opinion but also to restate their importance. The price of oil is in a downward trend... 6/10 Lundin Petroleum LUPE:SAX - Nigeria - Aje-4 Lundin will not take part in the Aje-4 drill... 6/10 Oil The Contracts - OPEC I would tread very carefully right now as there is a growing sentiment that maybe the OPEC talk is just that - talk. Saudiarabia for one seeīs no difficulty with WTI at $50 and OPEC should be very much aware of the gigantic mistake it made in 1998 by reducing production and escalating prices only a short time before the Asian Crisis... In this there are conflicting views on where the US economy is heading and slowdown and recession are words used, albeit just views. But the fact that oil demand has wained is a good indication that growth ainīt busting a gut... 5/10 OPEC The organisation is looking at cutting production by 1.0 mmbopd or 4% to stem the falling oil price. OPEC is to meet on the 14 December in Nigeria. The thing is that most of the Middle Eastern members have already cut production not least Saudiarabia so if the cut is a further reduction or just resetting the quotas to the reality is another question. With OPECīs track record on quotas it usually follows the trend that a statement of production change is just an affirmation of existing on the ground reality. Also please note that if OPEC actually cuts production by 1 mmbopd then they are at the same time aleviating one of the risk premium factors in the contracts ie the worry of spare capacity. A cut of 1 mmbopd would mean that OPEC increases itīs spare production capacity by at least 50%.... 5/10 USA - ETF - United States Oil Fund USO After a 9% drop in a week there is bound to be an uptick and it was a nice one yesterday. Very good trading weather... Trading range $52 to $56 yet as stated before the trend... 4/10 Oil USA - Statistics from the DOE - API 14.30 GMT Crude + 3.3 mmbls (API + 2.7 mmbls) Gasoline + 1.2 mmbls (API - 2.8 mmbls) Distillates + 0.2 mmbls (API - 3.0 mmbls) Natural Gas + 73 bcf Crude Import 10.5 mmbopd Gasoline Imports 1.1 mmbopd Refineries 89.9.0% - 2.5% Gasoline Demand 9.2 mmbopd Distillate Demand 4.1 mmbopd Total Petroleum Inventories + 4.0 mmbls Seasonal work on refining units took more out of the equation than expected, gasoline demand has started to back off yet it is still 3.5% higer than last year. Total Oil stocks are now 7.5% above last year. 4/10 Iran - Japan - Azadegan oil field Japan is on the brink of actually closing down the deal with Iran to develop the Azadegan oil field. This would be a major setback for Iran aswell as Japan. Irans nuclear ambitions are the point of contention. In this one has to remember that Japan is the only country yet to have fallen prey to a nuclear attack. In this Iran has in some part more to lose than Japan... 4/10 USA - ETF - United States Oil Fund USO The late to middle $40īs looks like a definite bottom... Investors in Spot Oil Contracts are fickle but for the most part correct, oil just ainīt hot today. A 9% drop in a week..... 3/10 USA - ETF - United States Oil Fund USO I donīt see a bottom to this one yet.. 3/10 OPEC - Nigeria & Venezuela So much noise... Nigeria says it has cut production by 5% this about half way true to the real on the ground fact that Nigeria is producing way below itīs current quota. Venezuelaīs Hugo Chavez is a moron... Enough said! OPEC is already producing below itīs quotas because there is simply put - ENOUGH OIL IN THE SYSTEM!! 3/10 Oil - Statistics from the USA DOE - API 4/10 14.30 GMT I expect, Crude + 2.5 mmbls Gasoline + 2.0 mmbls Distillates + 3.0 mmbls Natural Gas + 95 bcf Crude Import 11.0 mmbopd Gasoline Imports 1.4 mmbopd Refineries 92.0% Gasoline Demand 9.3 mmbopd Distillate Demand 4.1 mmbopd Total Petroleum Inventories + 6.1 mmbls No hurricanes due to a rapidly changing El Niņo, driving season over and done. I have a feeling we could see a Total Inventories increase in the low teens soon..