Falklands : Hydrocarbons Daily Record (23/05/07)
Submitted by Falkland Islands News Network (Juanita Brock) 24.05.2007 (Article Archived on 07.06.2007)
Inventory reporting, hurricane predictions and the US Naval exercise in the Gulf have helped the price of crude to increase today.
HYDROCARBONS DAILY RECORD: WEDNESDAY, 23 MAY 2007
By J. Brock (FINN)
At 1800LMT on Wednesday, 23 May 2007 Light Sweet Crude was trading at $65.77 up 26 Cents on the New York Mercantile Exchange and Brent Crude was trading at $70.60 up $1.08 on London’s Ice Futures Market.
ANALYSIS:
Several factors, including the hurricane forecast for the South Eastern United States, the shut off of supplies from Prudhoe Bay and tensions in the Mid-east, as well as a US Naval Exercise in the Gulf are helping crude prices to ratchet up today.
Investors are concerned that profits made from high gasoline prices are not being put back into infrastructure maintenance and new projects such as refineries. In the US there have been no new refineries in at least 30 years. But where does one put a refinery?
La Nina means that there is going to be more hurricanes hitting the Caribbean and the South Eastern United States. NOAA predicts 13 to 17 named storms, 7 to 10 hurricanes and 5 to 7 major hurricanes. It was the 2005 hurricane season thatdamage much of the oil industry’s infrastructure in the Gulf of Mexico, causing disruption of supplies and higher crude prices.
BRIEF INVENTORY REPORT FOR WEEK ENDING 18 MAY 2007:
Gasoline: up 1.5 million barrels to 196.7 million barrels
Crude: up 2 million barrels to 344.2 million barrels
Distillates: up 500,000 barrels to 120.3 million barrels
Refinery Capacity: up 1.6 % to 91.1% (Note: Some reports quote 90.1%)
THE MARKETS:
FTSE100: 6,616.40 up 9.79
FTSE250: 12,220.20 up 43.92
SmallCap: 4,126.70 up 6.00
DJI: 13,525.65 down 14.30
NASDAQ: 2,577.05 down 10.97
S&P500: 1,522.28 down 1.84
(Brazil and the People’s Republic of China)
Several Latin American and Chinese news agencies are report in that Brazil’s state owned oil company, Petrobras is working out a strategic co-operation joint venture in hydrocarbons exploration and refining with China’s oil company, Petrochina,
Speculation is that Petrobras may sign the agreement at the end of 2007. Petrobras, between 2006 and 2010, plans to invest some US$52.4 billion. It is thought that US$3.1 billion will be invested.
REGIONAL DEVELOPMENTS:
(Bolivia)
Speculation is ripe that Bolivia may be unable to deliver on its promise to increase gas supplies to as much as 20 million cubic meters a day to Argentina by 2010. Failure to quadruple the supply could cause shortages in Argentina and Chile. At the moment Bolivia’s gas production is committed to existing customers and there is little incentive to increase production. Higher royalties and taxes discouraging gas exploration is said to be the reason behind lethargic attempts to increase production. Bolivia signed an agreement with Argentine President Nestor Kirchner in October to deliver the increases. Under the agreement, Argentina to build a 1,500 kilometre pipeline to import gas from Bolivia at a cost of more than $1 billion.
RELEVANT SHARE PRICES:
TLW: 378.25 up 11.25
DES: 26.75 up 0.75
FOGL: 84.00 unchanged
RKH: 44.50 up 1.00
BOR: 22.00 down 1.00
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