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Coalition to support UK oil and gas sector, says Business Secretary Vince Cable

Vince Cable said the Government is preparing to offer targeted support for Britain's oil and gas sector as part of a new and "proper industrial policy".
In a move that represents a shift from last year's controversial tax raid on North Sea oil, the Business Secretary said the Government wanted to help the sector "re-energise" its supply chains, which include thousands of small businesses.


In a speech in London, Mr Cable said targeted Government support was needed to create a "different kind of economy" based on manufacturing and trade. Britain could not "just hope it happens naturally", he said. He and Charles Hendry, the Energy Minister, will chair meetings to "see how together we can support this important industry".


He insisted the plans were different to the "cack-handed interventionalism of the 1960s and 1970s" and denied that the Government was reverting to "picking winners" rather than trying to create a benign business environment.


But he argued: "There is a case for being more explicit about the choices we are making and linking them to a clearly articulated economic strategy."


With a nod to the previous Labour government, Mr Cable said Britain's car manufacturing industry had benefited from the "explicit choices" of government support. Other industries to be targeted include aerospace, media, film and fashion.

Commodities: Oil taps into 9% rise in February

Crude oil prices fell on Wednesday after a weekly US government report showed a larger than expected glut in oil supplies, an indication of weak demand.

The US Energy Information Administration said oil inventories increased 4.2m barrels in the last week, compared to forecasts of an 800,000 barrel-increase.

Gasoline supplies fell 1.6m barrels, the report said while inventories of distillates, which include heating oil and diesel, dropped 2.1m barrels. Analysts had predicted gasoline stocks to rise 100,000 barrels and distillate stocks to decline 600,000 barrels.

Light, sweet crude for April delivery climbed 52 cents to settle at $107.07 a barrel on the New York Mercantile Exchange, after a last minute buyers moved in.

Crude finished the month up nearly 9% after a strong rally on concern about tensions between Iran and the West.

Commodities: Oil jumps 1.4%, gold snaps losing streak

Crude oil futures bounced 1.4% on Wednesday after the Federal Reserve said it would consider easing measures and as progress was made on the Greek debt swap.

Crude for April delivery recovered from a weak start to the session to gain $1.46, settling at $106.16 a barrel on the New York Mercantile Exchange.

On the ICE futures exchange Brent crude rose $1.85 at $124.17 a barrel.

Oil prices tracked a broad market rally on Wednesday after a report from the Wall Street Journal suggested that the Fed is considering a new kind of bond-buying programme.

The report is in contrast to comments last week from Fed Chairman Ben Bernanke, which poured cold water on hopes of another bond-buying programme.

Saudi Assurances on Ample Oil SupplyU.S. Said to Have Received

By Indira Lakshmanan and Moming Zhou - Mar 14, 2012 12:00 AM GMT

The U.S. has received assurances from Saudi Arabia, the United Arab Emirates and Kuwait that they would raise oil production to help offset the effect of economic sanctions on Iranian exports, according to participants in discussions between the U.S. and oil-producing countries.

While there have been no formal requests, negotiations or agreements for increased output, the U.S. officials said they are confident that the Saudis and the UAE will boost production enough to prevent a dramatic increase in oil prices.
The three Arab countries had excess capacity of 2.47 million barrels of oil a day, with most of that coming from Saudi Arabia, according to the Paris-based International Energy Agency’s Feb. 10 market report. While that’s not enough to compensate for the loss of all of Iran’s 3.5 million barrels, it would help limit the increase in crude and gasoline prices that the sanctions cause when they start to take full effect in July.

“That’s a very pragmatic approach for the Saudis because they don’t want to see an oil shock and $150 crude,” Kyle Cooper, director of research at IAF Advisors, a Houston-based energy consulting firm, said by phone yesterday. “For some people in the market, it will be treated with a certain degree of doubt because Saudi Arabia probably cannot completely make up what Iran is producing.”

Brent crude, the benchmark for more than half of the world’s oil, has risen 18 percent this year on the London-based ICE Futures Europe exchange as the U.S. and Europe imposed sanctions on the Persian Gulf country. The oil is the third- biggest gainer among the 24 commodities on the Standard & Poor’s GSCI index. West Texas Intermediate, the U.S. benchmark, has advanced 8 percent on the New York Mercantile Exchange.

Tullow Oil celebrates record year, profits increase five-fold
Wed 14 Mar 2012

TLW - Tullow Oil


LONDON (SHARECAST) - Pre-tax profit at Africa-focused oil and gas giant Tullow Oil broke through the one billion dollar barrier in 2011, helped by a ramp-up in production and significantly higher commodity prices.

"2011 was a very good year for Tullow. Industry leading exploration success continued with the opening of a major new basin offshore French Guiana as well as further discoveries in Africa," the firm said.

Pre-tax profit for the 12 months ended December 31st surged by 499% from $179m to $1,073m on sales that jumped 111% from $1,090m to a record $2,304m.

Working interest production increased by 35% during the year, from 58,100 barrels of oil equivalents per day (bopped) to 78,200, while the realised oil price was 38% higher at $108 per barrel, from $78 per barrel in 2010.

Tullow said it was "another year of industry leading exploration and appraisal (E&A) performance", boasting a 74% success ratio.

The strong results prompted the group to double its full-year dividend from 6p to 12p per share.

Operating cash flow (before working capital) also surged, up 132% from $789m to $1,832.

Total have made an offer of 10p per share for Wessex Resources.
Evening news yesterday.

Chancellor George Osborne announces offshore oil sector measures

Measures to boost investment in the North Sea oil industry have been announced by Chancellor George Osborne.

His 2012 Budget includes new tax allowances, including a £3bn new-field allowance for large and deep fields to open up west of Shetland.

Mr Osborne also said the UK government planned to enter into contractual agreements on tax relief for North Sea decommissioning costs.

Tax experts said the steps could encourage "significant investment".

Mr Osborne told the House of Commons that he wanted to "ensure we extract the greatest possible amount of oil and gas from our reserves in the North Sea".

He announced: "We are today introducing a major package of tax changes to achieve this.

"We will end the uncertainty over decommissioning tax relief that has hung over the industry for years by entering into a contractual approach.

"We are also introducing new allowances including a £3bn new field allowance for large and deep fields to open up West of Shetland, the last area of the basin left to be developed. A huge boost for investment in the North Sea."

Continue reading the main story
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At a time when growth is very low in the economy, and significant stimulus is required, the Chancellor has allocated next to no new resources and taken no major initiatives to support this effort”
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John Swinney

Scottish Finance Secretary

Scotland's Finance Secretary John Swinney said the test of the chancellor's budget was whether it would "deliver growth and fairness to Scotland".

He told BBC Scotland he believed it would not pass that test.

Mr Swinney said that 20% of the lowest income households in the country were carrying more of a financial burden than the highest earners.

He added: "At a time when growth is very low in the economy, and significant stimulus is required, the Chancellor has allocated next to no new resources and taken no major initiatives to support this effort.

"At the Prime Minister's request we gave the UK Government a list of shovel ready projects in Scotland worth 300 million pounds which could start in the next financial year. There was no green light today and efforts to build economic recovery have not been given the boost we called for."

Scottish Labour leader Johann Lamont also viewed the Budget to be unfair.

She said: "Gone is the talk of 'we are all in this together'. This is a Budget riddled with unfairness which reflects the failings of George Osborne's policies. He is putting millionaires ahead of the millions and his plan isn't working.

Oil Trades Near 2-Week High on IMF Forecast, Spanish Sale

Oil traded near the highest close in two weeks after the International Monetary Fund boosted its growth outlook and a Spanish debt sale raised more than planned, easing concern an economic slowdown will curb crude demand.

Futures were little changed in New York after gaining for a second day yesterday. The IMF increased its 2012 global growth forecast to 3.5 percent from 3.3 percent and said oil will advance 10 percent this year on rising demand and possible supply disruptions. Spain sold 3.2 billion euros ($4.2 billion) of bills, compared with a maximum target of 3 billion. U.S. crude stockpiles climbed a fourth week, data from the industry- funded American Petroleum Institute showed.

“The IMF forecast and Spain auction and other indicators from Europe have all been positive factors,” said Ken Hasegawa, a commodity derivatives sales manager at Newedge in Tokyo, who forecasts West Texas Intermediate crude will trade near $105. “The upside is limited from here. It could be time for profit taking after the sharp gains of the last two days.”

Crude for May delivery was at $104.42 a barrel, up 22 cents, in electronic trading on the New York Mercantile Exchange at 1:52 p.m. Singapore time. The contract yesterday gained 1.2 percent to $104.20, the highest close since April 2. Prices are 5.7 percent higher this year.

Brent futures for June settlement were at $118.76 a barrel, down 2 cents, on the London-based ICE Futures Europe exchange. The European benchmark contract’s front month premium to WTI was at $13.93, from $14.14 yesterday, the lowest level since Feb. 1.

Technical Resistance

Oil in New York has technical resistance along its middle Bollinger Band on the daily chart, around $104.92 a barrel today, according to data compiled by Bloomberg. Futures halted yesterday’s advance near that indicator. Sell orders tend to be clustered close to chart-resistance levels.

The IMF’s oil-price forecast compares with a January projection for a 4.9 percent decline and assumes a level of $114.71 a barrel, based on the average of Brent, Dubai and WTI crude, the Washington-based agency said in a report. Non-fuel commodity prices will drop 10 percent this year, it said.

Crude reached the highest level since May last month amid speculation that Western sanctions aimed at halting Iran’s nuclear program will disrupt Middle East shipments. The U.S. and its allies say Iran is seeking the capability to make an atomic bomb. Iran says it’s conducting research for civilian energy and medical purposes.

U.S. Inventories

U.S. crude stockpiles increased 3.4 million barrels last week, the API said. An Energy Department report today may show they expanded 1.8 million barrels, according to the median of 10 analyst estimates in a Bloomberg News survey.

Gasoline inventories dropped 2.6 million barrels, the API said. They are forecast to slip 1.1 million barrels, according to the Bloomberg survey. Distillate supplies, a category that includes heating oil and diesel, fell 2.4 million barrels compared with a projected 125,000 barrel decline.

The API collects stockpile information on a voluntary basis from operators of refineries, bulk terminals and pipelines. The government requires that reports be filed with the Energy Department for its weekly survey.

U.S. gasoline demand declined 1.3 percent last week from the prior seven days and slipped below year-earlier levels for the 33rd consecutive week, MasterCard Inc. (MA)’s SpendingPulse report showed yesterday. Drivers bought 8.69 million barrels a day of the fuel in the seven days ended April 13, down from 8.8 million the prior week, it showed.

Market Regulation

Gasoline slid to a six-week low yesterday. Futures for May delivery fell 3.3 cents, or 1 percent, to $3.234 a gallon on the New York Mercantile Exchange. The motor fuel has lost 5.3 percent since reaching a 2012 high of $3.4166 on March 26.

President Barack Obama yesterday urged Congress to bolster federal supervision of oil markets, including bigger penalties for market manipulation and greater power for regulators to increase the amount of money traders must put up to back their energy bets.

Crude prices also rose yesterday after German investor confidence unexpectedly advanced to a two-year high in April, suggesting Europe’s largest economy can weather the debt crisis in the euro region’s periphery.

Argentina's oil takeover riles investors

http://www.seattlepi.com/news/article/Argentina-s-oil-takeover-riles-investors-3488599.php

Friday, April 20, 2012
Oil prices rise on European data

Oil prices in London and New York were on the rise today as positive European data lifted demand for riskier assets.

The UK’s Office for national Statistics reported a 1.8 percent increase in sales volumes for March compared with the 0.8 percent decline posted in February, while in Germany, the Ifo institute’s business confidence report topped expectations.

The German business climate index unexpectedly rose to 109.9 this month from 109.8 in March, while expectations were for a decline to 109.5.

This was also the sixth monthly increase in a row.

US stocks received more support from a positive start in US stock markets on the back of a better than expected earnings report from industrial giant General Electric (NYSE:GE).

The strong European data helped crude recover from yesterday’s falls on the back of weak US employment and home sales reports.

The Department of Labor said yesterday that the number of initial claims for jobless benefits decreased by only 2,000 last week, while also revising the previous week’s figure up by 8,000 to 388,000.

A separate report revealed that existing home sales dipped 2.6 percent t an annualised rate of 4.48 million units in March, which was seen as another sign that the US economic recovery is running out of steam.

US light, sweet crude for June delivery, currently the most actively traded contract on the New York Mercantile Exchange (NYMEX), rose US$1.58 to US$104.30/barrel in morning trade in New York.

June Brent crude climbed US$1.07 to US$119.11/barrel on the ICE Exchange this afternoon.

OIL FUTURES: Crude Gains With Equities, Falling Dollar

NEW YORK (Dow Jones)--Crude-oil futures rose Friday along with stock markets and the falling dollar, as improving data in Europe reduced worries about a slump in oil demand.

Light, sweet crude for May delivery recently traded $1.77, or 1.7%, higher at $104.04 a barrel on the New York Mercantile Exchange. The May contract expires at settlement on Friday, and futures for June delivery recently traded $1.68 higher at $104.40 a barrel.

Brent crude for June delivery on the ICE futures exchange traded 99 cents higher at $119.99 a barrel.

Oil gained as improving data out of Germany and the U.K. early Friday lifted European markets and provided a boost to U.S. stock market futures.

European markets were broadly higher. Dow Jones Industrial Average futures were recently up 72 points to 12,974.

The Ifo Institute's index of business confidence in Germany rose to 109.9 in April from 109.8 in March. U.K. retail sales for March rose 1.8% from February, well above expectations of a 0.8% increase.

The improving data also lifted the euro against the dollar. A falling dollar typically helps raise crude prices, as it makes oil cheaper for buyers in other currencies.

With tensions between Iran and the West cooling after recent talks, oil traders have turned their gaze back to the broader economy. A further slowdown in Europe would likely reduce demand in the region for oil and fuel products.

"We really saw a turnaround in sentiment with the business confidence numbers in Germany," said Matt Smith, an analyst at Summit Energy. "It's just a combination of a few bits of positive data."

Oil prices have fallen steadily from a peak near $110 a barrel in late February. But traders are unwilling to bet on prices falling through the key $100 a barrel level, particularly as retail gasoline prices have halted their rise under $4 a gallon.

As prices at the pump approached that key level in recent weeks, economists had feared rising fuel costs could scuttle the U.S. economic recovery.

Front-month May reformulated gasoline blendstock, or RBOB, recently traded 0.81 cent lower at $3.1460 a gallon. May heating oil recently traded 1.58 cents higher at $3.1409 a gallon.

Oil Rises to Near $104 After US Supplies Drop. April 25, 2012

Oil prices rose to near $104 a barrel Wednesday in Asia after a report showed U.S. crude supplies unexpectedly fell, suggesting demand may be improving.

Benchmark oil for June delivery was up 28 cents to $103.83 a barrel at late afternoon Singapore time in electronic trading on the New York Mercantile Exchange. The contract rose 44 cents to settle at $103.55 in New York on Tuesday.

Brent crude for June delivery was up 10 cents at $118.26 per barrel in London.

The American Petroleum Institute said late Tuesday that crude inventories fell 1.0 million barrels last week while analysts surveyed by Platts, the energy information arm of McGraw-Hill Cos., had predicted an increase of 1.5 million barrels.




Crude supplies have jumped more than analyst forecasts for the previous four weeks. The Energy Department's Energy Information Administration reports its weekly supply data later Wednesday.

"If the Energy Department corroborates, this would be a bullish number," energy trader and consultant The Schork Group said in a report.

Inventories of gasoline fell 3.6 million barrels last week while distillates also tumbled 3.6 million barrels, the API said.

Stronger U.S. crude demand could offset weakness in Europe where the region's debt crisis may force further government spending cuts that would hurt economic growth. Capital Economics expects Europe's economy to shrink 1 percent this year and 2.5 percent in 2013.

"Large parts of the eurozone are fundamentally uncompetitive and have unsustainable debt burdens," Capital Economics said in a report. "We still expect some form of eurozone break-up to begin in the coming year or so."

Investors will also be closely watching comments by the U.S. Federal Reserve about the strength of the recovery and monetary policy after its meeting Wednesday.

In other energy trading, heating oil was up 1.0 cent at $3.14 per gallon and gasoline futures fell 0.6 cent at $3.12 per gallon. Natural gas rose 0.4 cent at $1.98 per 1,000 cubic feet.