WTI $40.62 -1c, Brent $43.08 -2c, Diff -$2.46 -1c, NG $1.88 +5c
By Malcolm Graham-Wood
As can be seen above it was a quiet day on the oil markets, this morning prices are down modestly after an API report that slightly disappointed the analysts. Actually whilst the teenage scribblers got the sign wrong again in crude, as predicted in the blog, products remain strong with gasoline drawing 1.83m barrels and distillates fell 847/- b’s.
The EIA STEO shows a rise in forecasts for the oil price, for Brent they have $41 for 2H 2020 and an average for 2021 of $50 up $4 and $2 respectively. That has a knock-on effect for US production as we all know that some producers are even selling at $40 despite only covering cash and debt costs, at $50 they dont exactly make hay but certainly do ok. Finally the EIA have also taken the opportunity to cut back their demand fall figures and so stocks are definitely looking to fall significantly in the second half.
An operational and corporate update from Hurricane this morning, the 6 well on the Lancaster EPS is producing at 12,000 b/d with water cut up from 8% to 11%. As of 3rd July ESP’s have been fitted on both wells and combined production is now c.15,000 b/d so one must assume that the 7z well is de minimus although we don’t have any splits available and the 6 well should have increased…
Finally it is pointed out that the upcoming technical review may lead to a ‘material downgrade’ of the contingent resource estimates and with the next CPR not due for release until a likely ‘end Q1 2021’ it remains, as I said recently a long haul but only what should have been expected. 1H of 2021 is also likely to see the first chance of operational activity when I assume that they will take the opportunity to side-track the 7z well.
Finally I could not write about Hurricane without paying tribute to COO Neil Platt who passed away at the weekend. I spent a good deal of time with Neil and like anyone else who met him found him intelligent, knowledgeable and smart, he was indeed hugely respected and more than anything else a truly lovely man. His obvious passion for Hurricane and its progress, sometimes against the tide showed his courage and never-say-die attitude. I send all my condolences to his family at this time, his legacy will be immense.
Today sees the brave new world of cricket behind closed doors as the delayed test series against the West Indies starts at the Ageous Bowl in Southampton but as I speak, funnily enough it is raining..
In the Prem last night the Eagles 2-3 against Chelski, the Hornets beat the Canaries 2-1 and the Gooners and the Foxes drew 1-1 with some red card controversies.
Fixtures come thick and fast, tonight sees the Noisy Neighbours hosting the Magpies, the Blades entertaining Wolves, the Clarets go to the Hammers and the Seagulls host the Champions.
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