As we've had more damage assessment, it looks like it might be more severe than initially expected. Gasoline stockpiles are still very low and heating oil and diesel may be a bit of a worry going into the winter. |
In the short term, any kind of disruption from two very large producers like Iran and Nigeria isn't something that can be offset by other production. |
Iran is going to be the focus for still quite a long period. |
It could be that it shuts down all of Shell's onshore operations in Nigeria. The markets are going to discount Nigerian production in the price of oil. |
It is a strange market at the moment and frankly I am surprised that the rise we've seen earlier in the week from the Ukraine-Russia dispute is still there. People still feel a bit shaky about what happened in Russia and Ukraine, and with Sharon ill and some uncertainty in Israel. |
People are still concerned about Iran and potential military action. |
Prices are strong at the moment primarily because of the tensions over Iran and concerns over what might come out from the IAEA inspection. |
Supplies are ample and stockpiles are rising. We're still lacking spare production capacity but the market is fairly happy that there's a good buffer in place in the form of inventories. |
The market seems to be determined to pass 70 dollars. |
The markets are going to discount Nigerian production in the price of oil. It could be that it shuts down all of Shell's onshore operations in Nigeria. |
The particular type of oil being lost, light sweet, is much in demand. So we're actually seeing a real impact from the loss of that crude. Having said that, there is actually plenty of crude around. But a lot of it is heavy and sour. |
There is so little spare capacity and many risks to supply. |
There might be a little more flexibility in the U.S. refining system than people expected. Plants have been able to churn out more product than initially thought. |
With steady supplies and high inventories, at some point prices are going to have to retreat. |