Things were looking a bit gloomy there for a while but I cant...

Things were looking a bit gloomy there for a while but I cant help but things are just starting to improve...It is starting to look like OPEC production cuts might be filtering through, in which case, come summer driving season in the US we could have decent oil prices..which would lead to stronger revenue, better asset prices for farmouts/JVs etc......could also see a turnaround in sentiment towards oil stocks....that combined with the drilling of the upper sand, exploration acreage should provide happier times ahead...interested to see what they intend to do with Ash Creek as I would have expected something there early on possibly in the lower shannon formation, I guess it all comes down to cash....


"Oil trading early in the week was dominated by the stock market, with the Dow dropping 3.4 percent on Monday and then rebounding by 3.2 percent on Tuesday. Surprises in the weekly stocks report on Wednesday sent oil prices up six percent to close above $42 a barrel. The biggest surprise was that the demand for gasoline in the last four weeks is now 1.7 percent above last year. This increase, combined with lower imports, resulted in a 3.4 million barrel drop in gasoline inventories. The crude inventory was up by 700,000 barrels last week, well below the multimillion barrel increases we have seen in recent weeks.

Crude imports during the last four weeks are down by 13 percent year over year, suggesting that the OPEC production cuts may be taking hold. Tanker tracker Petrologistics reported on Monday it expects OPEC production in February will be down by 4.3 million b/d from September production. If this report is true, OPEC will be very close to its announced quotas. Another report notes that Asia is already feeling the impact of reduced shipments from the Gulf and that the impact will be felt in Europe and the US in the next few weeks.

"Officials from Algeria, Venezuela, and Iran continue to call for another production cut at the March 15th OPEC meeting. Iran says it has produced 550,000 b/d less crude for the last two months. Storage of oil aboard tankers, while awaiting higher prices, is now said to have increased to 80 million barrels giving more ammunition to those arguing for another production cut."