Along with OPEC production cuts and healthy company numbers, (both discussed below) the market is clearly disjointed. The tenor of discussions in the business pages and networks lately suggests that Yeats was right, and the centre cannot hold. Recession or recovery, echo boom or bust, few are predicting prolonged instability somewhere between these extremes.
Dutch company Shell has posted a jump in its Q3 profits to $8.45bn (£5bn) as crude oil prices increased to a record high. For full story, click here For company’s website, click here
Shell Plc and BP Plc are likely to announce that thier Q3 rsults rose from a year earlier while falling short of record Q2 profits, after crude fell 53 % from its July peak. For full story, click here For Shell Plc’s website, click here
Clearly Monday was not particularly good news for oil companies. With futures settling below $90 per barrel, ($87.81 when Benchmark went to proofing) the industry is seeing the lowest prices since February.
Another rough day for investors this Monday. As it became clear that the American House of Representatives would reject the authorization law for the executive’s $700 billion financial sector bailout plan, commodities began to tank. Oil futures shed more than $10 of their value during the day, dropping to $96.37 per barrel.
The expiration of October trading certainly played a disproportionate role in the record one-day gain, as it exercised a huge pressure on short positions. The meteoric rise also illuminates how much the vacillation is due to speculative activity.
Though ConocoPhillips (NYSE:COP) and Placid Refining Company are both receiving hundreds of thousands of barrels of crude from America’s federal reserves to continue refinery operations, and two rigs in the Gulf have been knocked adrift, the overall impact of Ike appears fairly benevolent to energy companies.
OPEC’s meeting tomorrow will almost certainly result in talk of cutting production, but not much in the way of concerted action. Member nations’ motivations are not synchronized, so consensus is exceedingly unlikely. Iran wants to impose OPEC-wide decreases, but the UAE thinks current levels are appropriate. Although OPEC will not move together on this issue, some countries (notably Saudi Arabia) are likely to retrench significant volumes.
Barrel prices nosed upward of $115 on Monday, largely due to a sagging US dollar. Analyzing this in reference to last week’s barrel and dollar prices shows the extent to which crude is tied to currency differentials. The relationship is not one sided, either. For us Canadians, high oil prices are keeping our dollar near parity with that of our neighbours.
Pilipinas Shell Petroleum Corp. reported a net profit of P4.7 billion in H1, more than double the P2.2-billion income it posted year-on-year, primarily due to a one-time gain of P3 billion. Pilipinas Shell said: It booked the gain from the assignment of the company’s economic rights to the Shell trademark to Shell Brands International of Switzerland. For [...]
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