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Crude on six-week high as OPEC mulls supply freeze

Analysts however are sceptical that a freeze in production at current levels would help shore up prices.
Oil pump in icy landscape
The collapse in oil prices over the last two years has hit OPEC members quite badly.

Brent crude hit a six-week high above US$50 a barrel today, as the world’s biggest producers are discussing a possible freeze in production levels. Brent rose to US$50.22 a barrel, up US$0.37 and the highest since July 4.

US Light crude oil was up US$0.65 to US$47.44.

Light, sweet crude for September delivery recently gained US$0.95 or around 2%, to US$47.74 a barrel.

Benchmark North Sea rose 20% from a low early this month on news OPEC and other key exporters like Russia are likely to revive talks on freezing output levels at a next month’s summit in Algeria.

The collapse in oil prices over the last two years has hit OPEC members quite badly. Some Gulf oil exporters have very low output costs, but other producers such as Iran and Venezuela need oil prices above US$100 in order to balance budgets.

Analysts however are sceptical that a freeze in production at current levels would help shore up prices.

Saudi Arabia, meanwhile, has signalled that it could boost its crude oil supplies in August to a new record.

Smallcap oil news

Premier Oil PLC (LON:PMO) boss Tony Durrant says a step change in production levels, thanks to a recent North Sea acquisition and a new field start up, has delivered a leaner operating cost base and helped the company address lower oil prices.

Premier Oil told investors it now expects to produce between 68,000 to 73,000 barrels oil equivalent per day in 2016, in this morning’s interim results.

Tullow Oil plc (LON:TLW) announced it has brought online the Tweneboa, Enyenra, Ntomme fields – together referred to as the TEN Project - on time and on budget.

First oil has now been achieved at TEN, offshore Ghana, and the company expects production to ramp up gradually up to 80,000 barrels of oil per day through the remainder of 2016.

TEN is expected to yield an average of 23,000 bopd for 2016, Tullow added.

Staghorn Petroleum buys 20% stake in the Chisholm Trail

Nostra Terra Oil & Gas Company Plc (LON:NTOG) has confirmed the completion of its US$2.1mln sale of its 20% stake in the Chisholm Trail project.

It also confirmed the identity of the buyer as Staghorn Petroleum LLC following the lifting of a commercial commerciality clause.

The junior oil and gas company said it intends to use the cash proceeds to accelerate its growth plans as well as general working capital purposes.

Victoria Oil & Gas shares rise after reserves and resources report

And finally, this morning Victoria Oil & Gas plc (LON:VOG) nudged higher after an updated reserves report for the Logbaba field in Cameroon.

The report set out reserves and resources as at 30th June 2016 as independently evaluated by consultancy Blackwatch.

Gross proved + probable (2P) reserves stood at 202.3bn cubic feet (bcf), with 2.8mln barrels of condensate, while gross mean prospective resources were put at 752 bcf with 10.5mln barrels of condensate.


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