OPEC’s El-Badri Says $200 Oil Possible With Lack of Spending Jan 26, 2015 3:54 PM Bloomberg
“If you don’t invest in oil and gas, you will see more than $200,” OPEC... Read More OPEC’s secretary-general said oil prices as high as $200 a barrel are possible if producers fail to invest in new supply. Crude futures pared losses in London and New York.
“If you don’t invest in oil and gas, you will see more than $200,” Abdalla El-Badri said in an interview in London on Monday, without giving a timeframe. Brent, a global benchmark, erased a decline immediately after his comments, before resuming its slide..
Crude prices tumbled 48 percent last year as Saudi Arabia and other members of the Organization of Petroleum Exporting Countries said they wouldn’t curb output in response to a supply glut. The International Energy Agency, the Paris-based adviser to 29 nations, said Jan. 21 that a decline in prices may deter investment in all types of energy.
“He is raising a valid concern that falling investments due to the current price collapse may leave us with little oil coming out of the ground in a few years time,” Ole Sloth Hansen, an analyst at Saxo Bank A/S in Copenhagen, said by e-mail. “A move back above $100 will bring the shale oil drillers out in force as they can relatively quickly react to rising prices” meaning $200 probably won’t happen.
The global oil market is currently oversupplied by about 1.5 million barrels a day and OPEC is open to a meeting with nations outside the 12-nation group to tackle the glut, El-Badri said today. The market will be brought back into balance by a reduction in supply, rather than an increase in demand, he said.
Investment in oil production will fall by $100 billion, or 15 percent, this year compared with 2014, Fatih Birol, chief economist at the IEA, said Jan. 21 at the World Economic Forum in Davos, Switzerland. This means oil at $45 a barrel will be a temporary phenomenon, he said.
Brent crude for March settlement rose as high as $49.29 on the ICE Futures Europe exchange in London, and was trading at $48.48 at 2:35 p.m. local time. West Texas Intermediate, the main U.S. grade, advanced as much as 1.1 percent to $46.11 on the New York Mercantile Exchange, before falling to $45.43.
U.S. crude production rose to 9.19 million barrels a day on Jan. 9, the fastest pace in three decades, according to the Energy Information Administration, the Energy Department’s statistical arm. The boom was driven by a combination of horizontal drilling and hydraulic fracturing, or fracking, which has unlocked supplies from shale formations including the Eagle Ford and Permian in Texas and the Bakken in North Dakota.
As prices slumped, oil drillers have reduced the number of rigs operating in the U.S. to the lowest in two years, according to data from Baker Hughes.
In one week we went ice climbing, snoe shoeing (x3), husky sledding (x2), skidoo-ing, igloo building, survival skills, cross-country skiing, ate lots, drank lots...it was great, I need a rest now though! We went with the Exodus company, they were great, can recommend them (for that excursion anyway).
I think is really good news how it can be legal is questionable but I'm not complaining! I'll be watching tomorrow to see what happens here an rns to say A5 flow testing is starting would be great! But let's not get to excited now!
That's right pal we are gonna fly again very shortly. That 50 grand buy is a massive sign and more investors will now jump aboard. We have had a bad few months since the September 1st 25p but I feel we are ready to rise again.
Agreed I think the resistance will be 10p tomorrow if we can get above that I think we will see rxp sp fly a lot of long holders on this board deserve to get rewarded for there patientence & research into a company that has great potential regardless of current oil prices due to the sheer volume of oil that could be discovered.
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