Stonger resistance remains at 462

typo error : )

KUWAIT CITY : Kuwait has boosted its oil production capacity to around 3.3 million barrels per day as it strives to achieve its target of four million barrels per day by 2020, a top oil executive said on Sunday.

Three million barrels per day are produced by the state-run Kuwait Oil Company and the rest comes from the neutral zone with Saudi Arabia, said KOC chairman Sami al-Rasheed, cited by the official KUNA news agency.

Rasheed said that KOC has successfully tested raising its output to three million barrels per day for the first time in line with its strategy of reaching four million barrels per day.

"We have come quite close to achieving our strategy of raising output capacity to four million barrels per day by 2020," Rasheed said.

"KOC production capacity now tops three million barrels per day, besides our share of around 270,000 barrels per day from the divided zone" with Saudi Arabia, he added.

He said KOC expects to add a new production of 120,000 barrels per day by the end of October, boosting total output capacity to around 3.42 million barrels per day.

Rasheed gave no spending figures on oil projects, but Kuwait's Oil Minister Sheikh Ahmad Abdullah al-Sabah said in December the emirate plans to spend 87 billion dollars on oil projects until 2030.

Kuwait says it sits on 10 per cent of proven global oil reserves and currently pumps around 2.3 million barrels per day.

- AFP

Forex Market;

The US Dollar was under siege this morning, recording losses across the board and numerous currencies posting all time highs against the Greenback. EURUSD, USDSGD, USDJPY, and AUDUSD broke through key levels this morning; EURUSD made a new 8 month high of 1.4094, USDJPY broke through the Oct 11 low of 81.39 after being large range bound in trading yesterday, and the AUDUSD was approaching the promised land of parity, posting an intraday high of 0.9982 (the highest level since the currency began trading freely). USDCAD already hit the magical parity mark, the first time since April this year, when it made a low of 1.0000. The Loonie has prospered on the combo of Dollar weakness and higher commodity prices and has gained 2.5% over the past month against the Greenback.

The star performer of the session was the Singaporean Dollar which surged to its all-time strongest level after it appreciated to 1.2894 against the Greenback. The Monetary Authority of Singapore announced it would ‘seek a modest and gradual appreciation,’ a stance quite opposite to its Asian Tiger counterparts. Commodities & equity markets also rallied hard during the Asian session, with Gold recording another all time high of 1380 and the Nikkei 225 gaining 1.91% on the day, despite a stronger Yen. Looking ahead, we await the weekly jobs numbers & PPI data from the US.

Singapore, October 12, 2010 : Jurong Shipyard (JSPL), a wholly-owned subsidiary of Sembcorp Marine, has secured an approximately S$351 million contract to convert the Aframax tanker, the MT Arc II (ex MT Arc), to a Floating Production Storage and Offloading (FPSO) vessel, to be renamed FPSO Petrojarl Cidade de Itajai, for Teekay Petrojarl Production AS.

Wall street article...

Petrobras busts the oil price and ignore oil trends

Crude oil has been on fire and prices were as low as $74 per barrel less than 3 weeks ago before recent highs  of $84.00.  Generally a rise in the commodity price garners a rise in the price of the key underlying shares in companies that drill black gold.  Petroleo Brasileiro (NYSE: PBR) or Petrobras, was trying to do well after its mammoth secondary offering.  That came to an end and Petrobras is now trading as a busted deal once again.  We wanted to see how this compares to other oil giants and we took a look at BP plc (NYSE: BP), Exxon Mobil Corporation (NYSE: XOM), Chevron Corporation (NYSE: CVX), and even ConocoPhillips (NYSE: COP).

The original deal of about 2.9 billion shares went off at an ADR price of $34.49.  On September 24 the ADRs traded more than 111 million shares and closed down at $34.92 versus $35.59 the day before.  It was just this Tuesday, less than two weeks after the offering, that shares hit a high of $36.90 and its highest close was also that day at $36.71.  What a difference 48-hours can make…Today shares are down 4.35% at $33.56 and shares closed down $1.61 at $35.09 yesterday.

Whether this is true is something we weren’t able to confirm,but there are market rumors that local weekly news outfits are going to reveal information which could bring on a corruption scandal involving the ruling Workers’ Party.  Brazil is supposed to be the hottest of the BRIC (Brasil, Russia, India, China) nations with what is supposed to be.  There is still the notion that this is Latin America and scandals have a long history to overcome throughout the region.  Petrobras this week noted that it would fall short of its annual production targets.

Yesterday’s drop was exacerbated because of a downgrade from Barclays.  The rating went to Equal-Weight from Overweight.  Morgan Stanley also maintained an overweight rating but lowered its fair value target down to $45 from $61 after the effects of the stock offering.  UBS gave Petrobras a SELL rating back in August and we recently gave the two varying takes on Petrobras and Brazil where a key technician and a key fundamental analyst were both effectively at the same conclusion.

How this compares to elsewhere….

BP plc (NYSE: BP) is down the least now, amazing considering its woes of 2010 and considering that it is back above the $40 handle.  Shares are down 0.4% at $41.45.  Shares hit a high of $42.08 this morning and that marked a high in the stock since this was trading under $30 as recently as the week before the Fourth of July break.  The 52-week range is $26.75 to $62.38.

Exxon Mobil Corporation (NYSE: XOM) is down only 0.55% today at $63.59 and its 52-week range is $55.94 to $76.54.  Shares hit a high of $64.00 this morning, but Exxon has also lagged as this was a $61 stock at the start of September.

Chevron Corporation (NYSE: CVX) is down almost 1% today at $83.07 and shares hit a new 52-week high of $84.50 this morning and this was just a $77 stock at the start of September.

ConocoPhillips (NYSE: COP) is down only 0.5% today at $59.39 and its 52-week range is $46.63 to $60.53.  Shares hit a high of $60.00 this morning and this was just a $54.00 stock at the start of September.

Whatever is happening at Petrobras is not pretty.  Many investors now have to be wondering whether they should have participated in the largest share offering in history.