Crude oil gained impetus from the equity and forex markets to rise above $72 in New York last night, as news of better than expected US Manufacturing pushed American markets higher. Combined with the continually weak dollar the Crude price was buoyant, offsetting mixed inventory data from the US Energy Department.
Headline crude inventories fell last week however gasoline and distillate stockpiles continued to increase, American distillate stockpiles are now the highest they have been since 1983.The oil market is becoming increasingly focused on the supply side fundamentals, however, some analysts still believe there is potential for more upside in oil should the equity markets continue to extend the summer’s gains.
In London, oil equities have progress well following the buoyant Crude Price, FTSE 100 constituent British Petroleum (LSE: BP) and Royal Dutch Shell (LSE: RDSB) both gained as much as 1% this morning, while Cairn Energy (LSE: CNE) has risen marginally.
Fellow FTSE 100 stock Tullow Oil (LSE: TLW) has extended yesterday’s strong session with the Ireland- based company adding almost 3% to Wednesday’s gains. Major Natural Gas producer BG Group (LSE: BG) had a less fruitful morning in London, falling 1½%.
In the junior market, AIM listed explorers and developers have experienced a more varied session. Europe focused Ascent Resources (AIM: AST) led the secto,r jumping over 6% this morning, reversing yesterday’s losses.
South American Amerisur Resources Plc (AIM: AMER) and Bankers Petroleum (AIM: BNK) gained around 9%, with the latter rising on fairly light volumes.
Elsewhere North Sea explorers Xcite Energy (AIM: XEL) extended yesterday’s gains, rising a further 8% this morning to 25p. Diversified Gulfsands Petroleum (AIM: GPX) advanced 2½% to trade as high as £2.54 earlier today, exploration financiers Empyrean Energy (AIM: EME) were also trading higher throughout Thursday morning.
In a relatively volatile morning session Iraq focused Petrel Resources (AIM: PET) followed on from Wednesday afternoon’s losses, dropping as much as 10% to trade at 37½p at around 11:30 this morning. South American based Pan Andean Resources (AIM: PRE) also fell, losing 6%, while Xtract Energy (AIM: XTR) dropped 3%.
Victoria Oil & Gas (AIM: VOG), Max Petroleum (AIM: MXP) and Mediterranean Oil & Gas (MOG) were also marginally lower at midday.