Oil & Gas 01 (May 08 - Jul 08)

[kennynah]

first, Oil's price was correlated to the USD currency...so when the latter decreased in value vis-a-vis major currencies, oil prices surged understandly...but ever since eur/usd hit 1.6, and did a reverse strengthened to current 1.55, oil still continued it pathway skywards... no meaning to this correlation anymore..

so, what were the excuses since for oil price to keep going up :

a) US distillates reserves drawn down...time and again, whenever the weekly data shows this..oil moved up
but is this logical? to me, utter nonsense. such data has been around for eons..and they were not oil price movers to the extend that we have been seeing

b) oil demand has grown from emerging markets...but hey, these emerging markets didnt just start emerging 3 months ago...to me, another spin to suck more people into Longing Oil futures..

Maybe, a plausible reason is the rising inflation in Europe..which has started to occur and is becoming for pronounced...

I am very worried for those who are Long Oil futures... when (and if) it take a 180 turn, it will be merciless...

[millionairemind]

Some news that might be good for those who shorted oil...

Congress Votes to Stop Stockpiling Oil Share

http://www.nytimes.com/2008/05/14/busin ... nd&emc=rss

By DAVID STOUT
Published: May 14, 2008
WASHINGTON — The House and Senate demanded on Tuesday that President Bush halt the shipment of oil to the country’s strategic petroleum reserve as long as oil prices remain high.

“Sticking oil underground is wrong at this point in time,” Senator Byron Dorgan, Democrat of North Dakota, said as he urged approval of a measure offered by Senator Harry Reid of Nevada, the Democratic majority leader.

The Senate voted, 97 to 1, to tell President Bush to halt the shipments to the strategic reserve, the supply of just over 700 million barrels that is stored in salt caverns along the Gulf Coast. The reserve is meant to protect the United States against a disastrous sudden cutoff of oil supplies, like the Arab embargo of the 1970s.

Tuesday evening, by a vote of 385 to 25, the House passed legislation that would suspend deliveries to the stockpile while the price of oil was above $75 a barrel, a measure that is similar to the Senate’s.

The Bush administration has opposed the measures. Given the sentiment in the two legislative chambers, any veto of the measure by President Bush would probably be overridden. But the Senate measure is part of another bill, while the House version is a stand-alone item, so there are some procedural hurdles that must be overcome before the oil-cutoff move can emerge from the full Congress.

President Bush has argued that the 70,000 barrels a day now being added to the reserve is insignificant, compared with the country’s overall consumption of oil. On that point, even some supporters of Mr. Reid’s measure agreed. The United States consumes just under 21 million barrels of oil a day, according to the Energy Department.

Senator Pete Domenici of New Mexico, the ranking Republican on the Energy and Natural Resources Committee, conceded that stopping the shipments to the reserve might be largely a symbolic step. Even so, he said, “this is one little thing we can do, and I think we should go ahead and do it.”

The president has argued that shipments to the reserve, which is now about 97 percent full, should be continued until the stockpile reaches its capacity of 727 million barrels. But most lawmakers said the 70,000 barrels a day, while only a tiny fraction of America’s daily consumption, would be better used to add supplies to the overall market, especially with oil now trading for more than $120 a barrel in the spot and futures markets.

President Bush was preparing to depart for the Middle East on Tuesday, and there was no immediate word from the White House about whether Mr. Bush would definitely veto the oil measure.

Only Senator Wayne Allard, a Colorado Republican who is not seeking re-election, voted against the measure, which took the form of an amendment to a flood insurance bill that was approved by a vote of 92 to 6.

Mr. Reid called the petroleum-reserve cutoff “a good first step” and said Republicans “must abandon their shortsighted strategy of ‘drill, drill, drill.’ ”

Shortly after the vote, Senate Democrats introduced legislation, timed to coincide with the president’s trip to the Middle East, to stop a scheduled arms sale to Saudi Arabia unless that country steps up its oil production.

“When the President meets with King Abdullah on Friday, we cannot settle for a smile, or a handshake, or even a glimpse into his soul,” said Senator Charles E. Schumer of New York. “We need a commitment to pump more oil. If Saudi Arabia and other OPEC countries do not substantially increase production, we in Congress will block their lucrative arms deals.”

Both the president and Vice President d**k Cheney have called on the Saudis to increase their output of oil.

Earlier Tuesday, the Senate rejected an amendment offered by Senator Mitch McConnell of Kentucky, the Republican minority leader, that would have opened part of the Arctic National Wildlife Refuge for oil exploration. That proposal, which needed 60 yes votes on a procedural motion to move ahead, got only 42, while 56 Senators voted no, effectively killing the amendment.

Senators Hillary Rodham Clinton of New York and Barack Obama of Illinois interrupted their campaigns for the Democratic presidential nomination to vote to halt shipments to the petroleum reserve. Senator John McCain of Arizona, the presumptive Republican nominee, was not present.

[kennynah]

oil and gas roundup all over the world
*******************

14 May 2008 08:30 GMT
TFN NEWS BRIEFING: Oil and utilities highlights to 09:15 BST


Falkland Oil And Gas hopes to start exploration drilling in 2009

LONDON (Thomson Financial) - Falkland Oil and Gas Ltd., which operates in the southern and eastern regions of the Falkland Islands, said it expects to commence exploration drilling in 2009 and plans are underway to drill wells under its BHP Billiton farm-in deal.


Petroceltic says initial results from new seismic on Isarene 'encouraging'

LONDON (Thomson Financial) - Oil and gas explorer Petroceltic International Plc. said it has got approval for a two-year second exploration at the Isarene block in Algeria, and that it received encouraging initial results from new seismic studies.


BG Norge makes oil find at North Sea's production license 292 - officials

OSLO (Thomson Financial) - BG Norge AS has made an oil discovery at the North Sea's production license 292, which officials in Norway say holds up to five million cubic metres of recoverable reserves.


Philippines delays auction for two power plants as bidders seek more time

MANILA (Thomson Financial) - The auction for two state-owned power plants in the Philippines has been pushed back to June 27 as the nine prospective bidders sought more time to comply with the requirements and conduct due diligence, the
agency tasked to sell the assets said on Wednesday.


Hungary's MOL buys up to 70 petrol stations in Austria from Doppler - report

VIENNA (Thomson Financial) - Hungarian oil and gas company MOL Nryt has bought up to 70 petrol stations from the Upper Austrian petroleum company Doppler GmbH, according to a report in the daily newspaper Der Standard which cites sources close to the company.


Oilexco sees increased production in H2 from Brenda, Nicol, Balmoral fields

LONDON (Thomson Financial) - Oilexco Inc. said net income and revenue for the first quarter of the current year surged as it realized the benefits of rising oil prices, a steady output from its Brenda and Nicol fields in the UK North Sea and its increased interests in Balmoral and Stirling fields.


BROKER CALL - Hong Kong-listed CNOOC target price raised to 16.50 hkd

HONG KONG (XFN-ASIA) - JP Morgan raised its target price for CNOOC Ltd by 10pct to 16.50 hkd while maintaining an "overweight" rating on the stock, factoring in higher earnings estimates for the upstream oil producer.


Soco says Yemen disposal strengthens balance, cancels $50 mln loan facility

LONDON (Thomson Financial) - Soco International Plc. said the disposal of its subsidiary Soco Yemen Pty Ltd. for $465 million cash has strengthened its balance sheet significantly and it has cancelled its $50 million unsecured revolving term loan facility with BNP Paribas.


Polish PGNiG Q1 beats expectations with 1 pct drop in Q1 net profit

WARSAW (Thomson Financial) - Polish gas monopoly PGNiG beat expectations with a one percent drop in first-quarter net profit after it sold more stored gas to offset soaring costs of supplies from abroad.


BROKERWATCH Unipetrol removed from 'top picks' at Wood & Co, replaced with OMV

PRAGUE (Thomson Financial) - Wood & Co removed Czech Refiner Unipetrol from its 'top picks' list and replaced it with Austria's OMV, citing an unfavourable environment for refining and petrochemical margins.


Tullow Oil Q1 oil and gas production in line with expectations

LONDON (Thomson Financial) - Tullow Oil Plc's oil and gas production for the first quarter of 2008 has been in line with expectations and the business has benefited from increasing oil and gas prices, it said in its interim management statement.


ECOFIN EU's Almunia says everyone, not just ECB, concerned about inflation

BRUSSELS (Thomson Financial) - EU economic and monetary affairs commissioner Joaquin Almunia said all of the euro zone finance chiefs and not just the European Central Bank are worried about the high level of inflation.


BROKERWATCH National Grid upped to 'buy' from 'hold' at ING

LONDON (Thomson Financial) - ING has raised its rating on National Grid Plc to 'buy' from 'hold', according to dealers, pointing to the company's inflation-proofed earnings and dividend growth.


DNO Q1 profits miss consensus on continuing high exploration costs

OSLO (Thomson Financial) - DNO International ASA on Wednesday posted first-quarter pretax profits slightly below expectations, pulled down by higher exploration expenses and other financial costs, but reiterated that investors will see a "step change" in its oil production once an export licence from Iraq has been secured.


Evonik to invest 4 billion euros for expansion by 2010 - management board member

FRANKFURT (Thomson Financial) - Evonik Industries AG., which is controlled by RAG Stiftung, is planning to invest about 4 billion euros for expansion by 2010, management board member Klaus Engel told Sueddeutsche Zeitung.


Galp, Venezuela's PDVSA sign 5 deals on oil, natural gas, renewables cooperation

LISBON (Thomson Financial) - Galp Energia, SGPS, SA and Venezuelan state-owned oil company PDVSA have signed five deals including one for Galp to acquire oil from PDVSA, two natural gas projects, a joint study of the Orinoco oil belt and the development of four wind farms.


Technip wins North Sea services contract worth up to 190 mln euros from Oilexco

PARIS (Thomson Financial) - Technip has won a three-year frame agreement contract worth up to 190 million euros for subsea services in the UK North Sea from Oilexco North Sea Ltd. The contract includes an option for an additional period, Technip said.


Anadarkos FY output guidance of 207-212 mln barrels of oil equivalent

LONDON (Thomson Financial) - Anadarko Petroleum Corp has reiterated its full-year production guidance at 207 million to 212 million barrels of oil equivalent.


Oil prices turn slightly higher in Asian trade

SINGAPORE (Thomson - Crude oil prices turned slightly higher in early afternoon Asian trade on Wednesday despite a forecast for slower energy demand growth.


Enterprise Products unaffected by proposed pipeline project agreement - S&P

MUMBAI (Thomson Financial) - Standard & Poor's Ratings Services said its 'BBB-' rating on Enterprise Products Partners L.P. is unaffected after the company signed a memorandum of understanding (MoU) with TransCanada Corp. and Quicksilver Gas Services L.P. regarding the proposed Pathfinder Pipeline project.


PGNiG Q1 net profit drops 1 pct on delay in gas price rise, above expectations

WARSAW (Thomson Financial) - Polish gas distributor PGNiG beat expectations with a one percent drop in first-quarter net profit after delays in the rise of regulated prices forced the company to sell more gas below cost.


Polish refiner PKN Orlen proposes no dividend from 2007 profit

WARSAW (Thomson Financial) - Poland's largest oil company PKN Orlen has proposed to pay no dividend from 2007 profit, the company said in a regulatory filing late on Tuesday.


Venezuela to swap oil for food, other goods with Portugal to alleviate shortages

CARACAS, Venezuela (AP) - Venezuela announced plans Tuesday to ship oil to Portugal in exchange for food products and other goods that have been running short in the South American country.


Oil prices ease in Asian trade after new record

SINGAPORE (Thomson Financial) - Crude oil prices eased in Asian trade on Wednesday after striking an all-time high near $127 despite a forecast for slower demand growth for energy.


PetroChina targets 2010 capacity of 5 bln cu m at Mahe gas field

BEIJING (XFN-ASIA) - PetroChina Co Ltd, the country's top oil and gas producer, has set a capacity target of 5 bln cubic meters at its Mahe gas field by 2010, parent China National Petroleum Corp said.


PetroChina resumes operations at fuel pipeline in Sichuan

BEIJING (XFN-ASIA) - PetroChina Co Ltd, the country's top oil and gas producer, has resumed the operations at a major oil products pipeline in southwestern China's Sichuan province, following Monday's 7.8-magnitude earthquake, parent China National Petroleum Corp said.


Proxy firm adds name to fight over Exxon Mobil CEO

NEW YORK (AP) - Rockefeller family members and other shareholders pushing to split the top leadership roles at Exxon Mobil Corp. gained another ally Tuesday when a proxy advisory firm came out in support of the effort.


Quest Resource 1Q net loss widens, shares fall

SAN FRANCISCO (Thomson Financial) - Quest Resource Corp. late Tuesday reported a first-quarter net loss of $11.6 million, or 50 cents a share, compared with a net loss of $3.31 million, or 15 cents a share, during the year earlier.

[HengHeng]

Given current Euro's movements the market is probably waiting for the inflation data from UK and US to decide its direction.

My opinion is that i'm looking towards oil going to 120 assuming if inflation in US continues to stay around 4% and Euro to go for prices to around 1.52.

But assuming if inflation is contained , we might see gold, oil and and euro bouncing back to higher prices.

[kennynah]

14 May 2008 08:46 GMT

Oil eases after record high, U.S. inventory numbers in focus
LONDON (Thomson Financial) - Oil eased Wednesday ahead of key U.S. inventory statistics, expected to show energy stocks in the world's top consumer rose last week and as traders took profits after yet another record Tuesday.

New York's main WTI benchmark struck a record $126.98 yesterday on news Iran, the world's fourth biggest oil producer, was eyeing a cut in production. Though those claims have been refuted by the country's oil minister, trader remain on edge.

"Whilst the Iranian oil minister was quick to refute suggestions of imminent cutbacks, the fragility of the market in respect of threats to supply coming on the foot of Middle East tensions and disruptions in Nigeria has resulted in an environment where the mere hint of geopolitical difficulties will inevitably result in a bullish surge," said Bank of Ireland analyst Paul Harris. "Today's focus will be the Energy Information Administration data released this afternoon detailing the current level of crude and product stocks."

The U.S. Energy Information Administration will release its inventory report for the week to May 9 on Wednesday at 10:30 a.m. EDT (1430 GMT).(that's 1030pm singapore time)

Crude inventories rose by 1.5 million barrels, analysts estimated, while refinery runs increased by 0.5 percentage points following last week's fall to 85.0 percent. Gasoline stockpiles were expected to have crept up by 100,000 barrels ahead of the peak demand driving season, the analysts predicted, while stocks of distillates, which include heating oil, are seen rising by 750,000 barrels.

At 9:27 a.m., New York-traded West Texas Intermediate crude for June delivery was down 42 at $125.38 a barrel.

In London, Brent crude for June delivery was down 95 cents at $123.15.

[kennynah]

14 May 2008 08:48 GMT
Gazprom Q1 gas production increases 4.2 billion cubic metres year on year


LONDON (Thomson Financial) - OAO Gazprom's first quarter gas production increased by 4.2 billion cubic metres (bcm) to 199.4 bcm compared to the same period in 2007.

The Russian gas producer said that by 2010 full year production will reach 570 bcm, growing to 610-615 bcm by 2015 and 650-670 bcm by 2020. By 2020 new fields will account for nearly a half of all gas produced, Gazprom said.

"By 2010 three new gas production centres will be in production the Arctic shelf, the Yamal Peninsula and East Siberia-Far East," Gazprom said in a statement. "These are expected to develop into major production hubs over time. In the near future, Shtokman and Bovanenkovo, two unique fields in the Arctic shelf and Yamal, will be put into operation."

[kennynah]

sorry if this is a repetition of what i just posted..but it's important and a mkt mover...so, better to be safe than sorry...

light sweet is at 125.35 (down a mere $0.45)

********************
14 May 2008 10:35 GMT
Ahead of the Bell: Oil Inventory Report
WASHINGTON (AP) - Government data released Wednesday is expected to show that crude-oil inventories rose last week for the fourth straight period and that gasoline stockpiles fell.

The Energy Department's forecasting arm, the Energy Information Administration, publishes petroleum inventory data for the week ended May 9 at 10:30 a.m. EDT.

Analysts expect oil stockpiles grew last week by 2.5 million barrels, according to a survey by Platts, the energy research arm of McGraw-Hill Cos. For the week ended May 2, crude-oil inventories rose by 5.7 million barrels, or 1.8 percent, to 325.6 million barrels, which were 3.6 percent below year-ago levels.

Analysts expect stockpiles of the motor fuel fell by 800,000 barrels last week. The prior week, gasoline inventories rose by 800,000 barrels, or 0.4 percent, to 211.9 million barrels, which were 7.6 percent above year-ago levels.

Demand for gasoline over the four weeks ended May 2 was about 0.1 percent higher than a year earlier, averaging nearly 9.3 million barrels a day.

At the same time, U.S. refineries ran at 85 percent of total capacity on average, a drop of 0.4 percentage point. Analysts expect capacity rose by 0.8 percentage point last week.

Inventories of distillate fuel, which include diesel and heating oil, fell by 100,000 barrels to 105.7 million barrels for the week ended May 2. Analysts expect distillate stocks rose by 1.1 million barrels last week.

At the pump, gas prices rose more than a penny overnight to a record high national average of $3.73 a gallon Tuesday, and are well above the year-ago average of $3.07 a gallon, according to AAA and the Oil Price Information Service. Diesel prices also set a record of $4.39 a gallon.

Light, sweet crude for June delivery jumped to a new record of $126.98 a barrel before retreating to settle up $1.57 at $125.80 a barrel on the New York Mercantile Exchange.

Also Tuesday, the Senate voted 97-1 to direct President Bush to stop adding roughly 70,000 barrels a day to the nation's strategic petroleum reserve. Some lawmakers feel the shipments are pushing oil prices higher. The administration contends the reserve is to be used only to counter a severe disruption in supply, not in reaction to prices.

[winston]

Long-dated natural gas (NG) prices have adjusted upwards in recent months, but have lagged crude oil. We remain bullish and believe that it is too soon to scale back long/overweight positions.

Canadian natural gas production and rig count remain weak because of cost inflation and the strong Canadian dollar.

U.S. natural gas production has rebounded but depletion rates are high and the rig count may be topping out. In addition, significant exploitation of non-conventional gas shale deposits will be expensive and take years before bearing fruit.

Moreover, the plunge in liquefied natural gas (LNG) imports during the second half of last year underscored that they will not be a panacea with Asia and Europe competing vigorously for LNG.

– BCA Research

[winston]

What If Oil Really Doesn't Go To $200 a Barrel???
By Larry Connors | TradingMarkets.com | May 13, 2008

For those of you who are out there wondering how to become famous overnight (and for at least a good 15 minutes), here is the recipe:

1. Find a hot market (anything that has doubled or tripled in value over the past year will do).
2. Create some crazy inflated "round number target.".
3. Release this prophetic inflated "round number target" to the press.

Within a few days you’ll be everywhere.

Dow 36,000! It worked great 9 years ago. The authors even got a book deal!

Internet stocks going to $1000/share! Guaranteed spot of CNBC and most major media organizations.

Oil is heading to $200! Ubiquitous! Especially this past weekend.

But what if you don’t want to be famous? What if you don’t buy the hype? How do you profit from these prophets in case they’re wrong? Let’s look.

3 Ways to Bet Against the Oil Bubble

By now everyone in the world knows oil is going to $200 a barrel. Not only did Goldman Sachs predict it….more importantly I saw the same prediction in the New York Post. But what if these two institutions (along with the many, many thousands of speculators) are wrong? How can you profit from them in case this "can’t miss" prediction really does miss.

There are a few ways. And I’ll share three with you.

1. Short oil futures and/or oil stocks (like Exxon (XOM | news | PowerRating | PR Charts ), etc.). This one is obvious. But it’s like putting your face in front of a speeding train. Great if it works. But your losses are unlimited if it’s wrong. This is not the best of the strategies.

2. Do the above but protect yourself. Short anything oil-related and buy an out of the money call in what you shorted. Should prices rise, your call will begin to move about point for point with the underlying once it gets in the money. If you’re right, and oil drops, you’ll keep 100% of the gains minus the cost of your call. This is a better strategy than number one and it’s more prudent.

3. Most Aggressive. This one is a bit novel. Look at the UltraShort Oil and Gas ProShares (DUG | news | PowerRating | PR Charts ). They seek to move double the inverse of the Dow Jones U.S Oil and Gas Index. The interesting thing about this ETF is that unlike most short positions which have unlimited loss potential, this one can only lose what went into it. You’re basically getting a short position without the risk of unlimited losses. And if oil drops in price, you’ll earn approximately double the drop on a percentage basis. Again, it’s aggressive, but it has some real nice kickers if the hype really is too extreme.

All bubbles end the same. This one will too. I don’t like going against Goldman Sachs (and especially the New York Post). But with sentiment this high, nibbling on the short side of oil prices with some protection is too good an opportunity to pass up.

Larry Connors is CEO and Founder of TradingMarkets.com and PowerRatings.net

[kennynah]

if one believes that Oil is relenting going forward... consider airliners :

CAL, UAUA, DAL, AMR, JBLU, LCC, GOL, of cos SIA