WTI $59.64-$1.62, Brent $63.80 -$1.69, Diff $4.16 -7c, NG $2.63 -6c
Oil price
The day before the Opec meeting and the good and the great from the oil industry are gathered in Vienna talking shop. The oil price fell yesterday after the EIA inventory stats which despite showing a draw of 1.9m barrels and thus relief after the API numbers, were still deemed slightly disappointing. At this time of the year it is important to watch carefully the product stock movements and whilst gasoline fell, distillates rose by 3.8m barrels way more than the 1.1m barrel forecast. Refiners, who have seen very strong world-wide diesel demand recently, have enjoyed the high margins and are making hay while the sun shines but at 93% + refinery runs they need that demand to remain robust, big stock builds don't help.
There is no doubt that anything but the current status quo would be a surprise from tomorrow's meeting and the words from Gulf oil Ministers yesterday seemed to predict a short sharp meeting, indeed the Iraqi and Saudi Ministers were clearly singing from the same hymn sheet.
Oil industry executives were out in force too as the opportunity to blow into a few Opec ears was too good an opportunity to miss. What they said was a mixed bag, Rex Tillerson stating that US shale was ‘moving to a different place’ by reducing costs (not what Opec wanted to hear) and John Watson of Chevron saying that the world should be more realistic on carbon emissions (which is what they did want to hear). Watson pointed out to Europe that closing down nuclear power plants and being hostile to shale gas would rather tie their hands behind their backs, highly intelligent speak. Finally, Bo Diddley expects low oil prices until 2016 which is fine if anything below $100 is low, if he’s thinking sub $50 then we are all doomed…
Aminex
An update this morning from Aminex with regard to financing in which the company say that they have negotiated a six month extension to the corporate loan facility. With Kiliwani first gas expected in ‘mid 2015?, (Aminex are awaiting final commissioning of the pipeline and the process plant), things must be imminent and visible or a further delay would have been flagged so that is good news. Elsewhere the GSA still has not been signed up but again the company appear confident that it is…
