Falklands : Hydrocarbons Daily Record (27/06/07)
Submitted by Falkland Islands News Network (Juanita Brock) 28.06.2007 (Article Archived on 12.07.2007)
Analysis got it wrong and a decline in distillate and gasoline inventories helped to increase the price of crude today.
HYDROCARBONS DAILY RECORD: WEDNESDAY, 27 JUNE 2007
By J. Brock (FINN)
At 1800LMT on Wednesday, 27 June 2007 Light Sweet Crude was trading at $68.97 up $1.20 on the New York Mercantile Exchange and Brent Crude was trading at $70.53 up 31 Cents on London’s Ice Futures Market.
ANALYSIS:
Perhaps analysis prior to the release of the US Department of Energy Administration Inventory Report isn’t such a good thing. The decline in supplies of gasoline and distillates has caused the price of crude to rise today. Refinery capacity increased by 1.8% to 89.4% and this is key to the supply of distillates and gasoline. Capacity has been as high as 91.1% lately and it is thought that some of the profits made by oil companies can be spent on infrastructure that would help to increase refinery capacity. Also key to the price of gasoline and distillates is the price at which reserves of crude are bought. The higher the price means the end products will be more expensive.
BRIEF INVENTORY REPORT FOR THE WEEK ENDING 22 JUNE 2007:
Crude: Up 1.6 million barrels to 350.5 million barrels
Gasoline: Down 750,000 barrels to 202.6 million barrels. Some press reports read that supplies declined 749,000 barrels and others say 700,000 barrels.
Distillates: Down 2.3 million barrels to 120.4 million barrels
Refinery Capacity: Up 1.8% to 89.4%
THE MARKETS:
FTSE 100: 6,527.60 down 31.68
FTSE 250: 11,391.90 down 145.21
SmallCap: 4,001.10 down 27.19
DJI: 13,427.73 up 90.07
NASDAQ: 2,605.35 up 31.19
S&P500: 1,506.34 up 13.45
INTERNATIONAL DEVELOPMENTS:
(India)
Petrobras has agreed to take a 30% stake in one of ONGC’s discovered gas blocks in the Krishna Godavari basin. The Brazilian state owned company will now jointly operate the block, KG-DWN-98/2, with ONGC. In a press release an ONGC official said, “We will offload 15% stake in the KG basin block in favour of Petrobras. The Brazilian company will acquire the additional 15% only after the development plan is approved by the directorate general of hydrocarbons. A bonus will be paid to ONGC when the agreement is signed.” ONGC’s gas reserves in the KG basin at 2.09 trillion cubic ft.
REGIONAL DEVELOPMENTS:
(Argentina)
According to Argentina’s presidential website bidding has started for the Gasoducto de Noroeste Argentario (GNEA) project. Argentina's President Néstor Kirchner and Bolivia’s President, Evo Morales started on Wednesday that the bidding process for the $2billion USD GNEA gas pipeline project. This should replace Argentina’s ageing gas pipeline and will benefit Argentina’s Northern provinces, which lack gas service.
The pipeline will have a capacity of 27.7Mm3/d of natural gas to Argentina. Argentina's portion of the pipeline will run 1,500km and Bolivia's will cover 90km. The pipeline should be complete by 2010.
RELEVANT SHARE PRICES:
TLW: 477.25 down 13.00
DES: 30.25 unchanged
FOGL: 80.00 up 0.50
RKH: 42.00 down 0.50
BOR: 24.50 unchanged
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