Oslo Stock Exchange
Oslo Stock Exchange evolved significantly better than European exchanges otherwise Thursday lifted by oil-related companies.
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There were gains among the several of the biggest oil companies Thursday. Statoil, which is the exchange’s largest companies, ended up 1.79 prsoent to 123.80 kroner. The Norwegian oil company rose 1.52 percent to 60.00 crowns.
Several of the major oil-related companies also rose.
Subsea contractor Subsea 7 rose 5.25 percent, the rig company Seadrill was up 10.98 percent and seismic company PGS was up 12.63 percent.
– Behaving better
Crude oil inventories in the US rose sharply last week without giving a major impact on oil prices.
Commerzbank believes the market now focuses more on long-term factors, rather than stock-building in the short term, and interpret it as a clear sign that sentiment in the market turns.
Commerzbank supported of Credit Suisse who writes that the oil market has “begun to behave better.” It is clear that $ 30 per barrel is too low and you see clear response to this from the supply side, according to them. They conclude that demand fears have been exaggerated.
As we go through the season for refinery maintenance and the maximum demand over the summer, one can “feel upside pressure,” writes Credit Suisse.
SEB believes that it is too early for a continued and sustained rise in oil prices from current levels. The brokerage also points out that the agreement on production freeze among OPEC countries and Russia has contributed to positive developments in recent weeks.
Participants in the tanker market thinks it is very unlikely that freezer agreements will be extended to actual production cuts.
I do not think Opec will ever cut. They’re going to keep going and going until they have hurt American production enough, said CEO Robert Burke in Ridgebury Tankers during a panel discussion in connection with DNB’s oil and offshore conference Thursday.
Brent 1st position traded as of this writing for $ 36.88. Oil prices were about $ 36.50 per barrel when the Oslo Stock Exchange closed Wednesday.
Statoil gained 1.8 percent on Thursday while oil service index ended up 5.5 percent. Frontline ended up 1.5 percent.
Oil Lift
Oil prices rose towards the end of trading on Wednesday night, despite the fact that the weekly inventory report showed a sharp increase in US crude oil store last week.
the market put in place an emphasis on figures showing that US oil production fell for the sixth week in a row, stated chief strategist Erica Blomgren tomorrow report from SEB.
She pointed out that decline in US crude production and the number of active rigs in the United states, as well as discussions about the production freeze among OPEC countries and Russia have been the main drivers for the optimistic developments in recent weeks.
in the forward market also has the number of bets on the rise in oil prices has increased significantly since January.
– in our view it is too early with a further and sustained oil price rally from here, writes Blomgren.
She believes that the market can again come to test level of 30 dollars a barrel for Brent oil again, before the market is going to recover.
– Oil prices should recover later this year and we estimate an average Brent price of 40 dollars per barrel in 2016, writes Blomgren.
the downward revision in forecasts
Nordea Markets has revised down its oil price forecasts, and they are now expecting an average Brent price of $ 41 a barrel in 2016 and $ 60 in 2017, from previously estimated respectively $ 49 and $ 65, according to an update from oil analyst Thina Margrethe Saltvedt of Nordea Markets on Thursday.
the brokerage believes oil prices bottomed out in January and will rise through the projection period, which will last until 2017.
Oil analyst estimates Brent price to $ 33 in its first quarter in 2016, $ 39 in the second quarter, $ 43 in the third quarter and $ 50 in the fourth quarter.
Oil price inflation is projected to slow in 2017 as slate manufacturers in the US is expected to increase production at prices above 60 dollars a barrel. The increased production is expected to act as a ceiling for oil prices in the medium term until you see the effect on oil production growth of previous years significant investment shot, according Saltvedt.
The main index on the Oslo Stock Exchange ended up 0.92 percent to 576.36 points, traded for 3,991 billion.
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