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Singapore Petroleum Company ? Has again bought into an Australian oil/gas exploration and production (E&P) company, this time in Cue Energy Resources, another of its offshore partners, to ride on the E&P boom in Australia. The company yesterday announced that it had acquired 5.38% equity interest in Cue Energy 'for investment purposes' through trades on the Australian Stock Exchange between 26 April and 20 July at an average price of A$0.192 per share. Its purchase of 33,825,000 shares of Cue, through nominee shareholders, works out to A$6.49m (S$8.6m). Cue Energy is one of its partners in Indonesia's Oyong field, which is expected to start producing oil this quarter, or by September. Santos, the field operator, said recently that the field should yield about 5,000 to 8,000 barrels per day of oil. SPC, with a 40% stake in Oyong, is expecting to get over 6,000 bpd of oil from the field, which will be its second producing field after Indonesia's Kakap where it is getting 2,540 bpd currently.
Yeah..... congrats to all those vested. Hmmm, again a bit regret didnt buy more.....
TA charts looking really bullish. Acc/Dist, MACD and Chaikin up.
Wow!!! Closed at $6.85!!!
Looks like will hit $7.00 before the report announcement.
Can you imagine this? $100/barrel
$100 Oil May Be Months Away, Not Years, Say CIBC, Goldman
2007-07-22 19:10 (New York)
By Mark Shenk
July 23 (Bloomberg) -- The $100-a-barrel oil that Goldman
Sachs Group Inc. said would prevail by 2009 may be only a few
months away.
Jeffrey Currie, a London-based commodity analyst at the
world's biggest securities firm, says $95 crude is likely this
year unless OPEC unexpectedly increases production, and
declining inventories are raising the chances for $100 oil. Jeff
Rubin at CIBC World Markets predicts $100 a barrel as soon as
next year.
``We're only a headline of significance away from $100
oil,'' said John Kilduff, an analyst in the New York office of
futures broker Man Financial Inc. ``The unrelenting pressure of
increased demand has left the market a coiled spring.'' New
disruptions of Nigerian or Iraqi supplies, or any military
strike against Iran, might trigger the rise, Kilduff said in a
July 20 interview.
Higher prices will increase revenue for energy producers
from Exxon Mobil Corp. to PetroChina Co., while eroding profit
at airlines including EasyJet Plc and railroads such as Union
Pacific Corp. The U.S. and other oil-importing nations risk
accelerating inflation, while higher energy costs threaten to
restrain growth.
Benchmark crude oil futures ended last week at $75.57 a
barrel on the New York Mercantile Exchange, up 51 percent since
mid-January and twice the level of early 2003. A record number
of options have been sold that give the buyer the right to buy
crude oil at $100. The contracts, covering 50 million barrels,
only pay off should oil go above the target price.
Goldman's View
Arjun Murti, a New York-based Goldman Sachs analyst who
covers oil producers and refiners, roiled markets in March 2005
with a report saying prices could touch $105 a barrel during a
``super spike'' period because demand was stronger than
anticipated. Price swings might also go as low as $50, Murti
said at the time.
Currie, Goldman's global head of commodities research in
London, is predicting that oil prices will probably touch a
record and stay at unprecedented levels for months or years. The
all-time high for Nymex crude futures is $78.40 a barrel on July
14, 2006.
``Ultimately, the key to the outlook going forward is when
will Saudi Arabia ramp up production,'' he said in an interview.
``If you have a situation in which inventories globally get
drawn to critically low levels, the volatility in this market is
likely to explode, which significantly increases the probability
of $100 oil.'' Oil might slip to $73.50 if OPEC were to start
producing more now, he said.
The Organization of Petroleum Exporting Countries is
scheduled to next meet in September. No members have called for
a gathering before then. A decision to raise output at that time
would lead to greater supplies toward the end of the year.
Accelerating Demand
The failure of near-record fuel prices to restrain global
oil demand growth is what concerns Rubin, chief strategist at
the brokerage unit of Canadian Imperial Bank of Commerce in
Toronto.
``Prices have doubled, and demand is alive and well and
accelerating,'' he said in a July 18 interview. ``The argument
that rising prices would choke demand and bring increased output
is falling to the wayside.''
A National Petroleum Council study led by former Exxon
Mobil chairman Lee Raymond, released last week, predicted a
growing gap between production and demand for oil and gas during
the next two decades. As recently as 2005, Raymond said oil
prices had probably peaked and dismissed the possibility that
supply and demand could not be brought back into balance.
``There are questions about whether the oil industry can
keep up with demand,'' U.S. Energy Secretary Samuel Bodman said
last week, commenting on the Petroleum Council report
Pickens
A pullout from Iraq may be the event that pushes oil to
$100 a barrel, according to Boone Pickens, the Dallas hedge fund
manager who has joined Forbes Magazine's list of billionaires
because of his bullish bets on energy prices. Pickens predicted
a year ago that $100 oil would probably occur by now. Today he
is looking for $80 within six months, and he says growing chaos
in Iraq would be a bad sign. ``That could run prices pretty
high,'' he said.
Goldman Sachs's Currie also notes similarities to a year
ago, with global inventories at about the same level and U.S.
government data showing an increasing bet on higher prices.
``At face value this market is strikingly similar to a year
ago,'' Currie said. ``What is different? Supply is down a
million barrels a day, demand is up a million barrels a day. The
market is in a deficit.''
--With reporting by Stephen Voss in London and Wang Ying in
Beijing. Editor: Dieterich (tjc/ecw)
SPC held well to profit taking at this level. More buyers then sellers by 3:1.4 respectively. The chart is still showing bull. No sign of retreat yet. I was worried in the morning, but not now. I think we can hold on to announcement date which is 2 days away. $7.00? Cheers!
hi Pinnacle, I dont think we need to worry about profit taking... when results are out it would become clear that SPC is indeed value for money... I am staying vested at least until then...
I'm afraid profit taking happening too soon. Then we may not see the full potentital of the share price from the report on announce on wed.
Shouldn't GS review this counter 1 month ago, now that the share price is on a run away? Being a fund manager is so simple, can change goal post as and when they like. Does this singals a sell now?
DJ MARKET TALK: SPC +4.7%;2Q Net Profit Tipped To Rise 8% On Year
0352 GMT [Dow Jones] SPC (S99.SG) +4.7% at S$6.75 on average volume ahead of 2Q07 earnings due after market closes Wednesday; Goldman Sachs expects net profit to rise 8% on year, 31% on quarter to S$147 million on back of strong gross refining margins. Goldman has Buy rating, target price of S$7.20 (6X 2008E EV/EBITDA) on stock, tips upside risk to estimates which are already above consensus, possible further share price re-rating. Share price also boosted by recent rise in oil prices with September contracts at US$75.48/bbl; upside capped at multi-year high of S$6.80. (JEM)
ho seh liao...!!! Congrats to all vested...!!!!!
No horse run liao! A mad horse.
+$0.30!
cheong too fast!!!
go up fast, come down fast and hit harder.
Beware of profit taking!!!
SPC had better closed above $6.55 today. This morning it hovers ard $6.55 creating a "cross" above last Friday's close, it's not a good sign in TA term. But TA is meant for short term trading, fundamental of SPC will prevail eventually....Aha...while writing the big ones came in 176, 150, 260 lots...cheers to all!
Singapore Petroleum
Still going strong despite weak market.
Building up momentum for this wed.
looks like it may touch 6.60 today...
Over the past few months, the oil markets have sharply changed course. After dipping below $60 per barrel in early 2007, prices have come roaring back. U.S. benchmark West Texas Intermediate (WTI) crude is now trading at $76.19 per barrel, its highest level since last August.
What's even more striking is that the OPEC Basket, which is composed of heavier, lower-quality crude oils, hit an all-time peak of $73.23 per barrel on July 19. The OPEC Basket usually trades at a substantial discount to the Western marker crudes, Brent and WTI, but the differentials have narrowed as thirsty consumers in the U.S. and emerging markets push the pedal close to the floor.
In a relatively short time, the market psychology has turned around nearly 180 degrees. Last fall, there was worry about an overhang of non-OPEC supply, compounded by concern about a drop-off in demand growth. Added to that was a seeming willingness by OPEC to pump enough to keep plenty of oil in Western tanks.
A few months later, none of those assumptions turns out to have been correct?and traders have moved into record long positions in crude oil futures. Thanks to project delays, production outages, and steep declines in aging fields, the anticipated huge new supplies of oil from non-OPEC sources look unlikely to materialize (see BusinessWeek.com, 06/28/07, "The Problem's Not Peak Oil, It's Politics"). Paul Hornsell and Kevin Norrish, analysts at Barclays Capital, the London-based investment bank, peg new non-OPEC supply at a skimpy 500,000 barrels per day for 2007 and zero for 2008.
Low Supply, High Demand
Growth in demand is expected to be robust?in the range of 1.5 million barrels per day this year and next. But it will be almost entirely up to OPEC to slake that thirst. And the oil sheikhs, stung by the price plunge early this year, have responded by tightening supplies, taking significant amounts of crude off the market.
"Global crude oil production is over 1 million barrels per day lower than last year, while global demand is over 1 million barrels per day higher," says Jeff Currie, an analyst at Goldman Sachs (GS) in London. Tracking rising oil prices, shares in European majors such as Total (TOT) and Royal Dutch Shell (RDSA) are up more than 30% from their 2007 lows, set in early-to-mid March. American giants Exxon Mobil (XOM) and Chevron (CVX) are up even more.
The runup in oil prices to date isn't going to wreck the world economy, experts say. After all, prices are now comparable to their peak last year, so there has been very little actual energy price inflation?one reason demand hasn't taken much of a hit. Europe's economies, in particular, are likely to be insulated from the price rise by the concurrent weakening of the dollar?which is still used for nearly all oil trading?against the euro and British pound.
'Full-On Bullish'
The big question is where prices go from here. Last summer, after the much-feared hurricane season turned out to be a pussycat, prices began dropping sharply. Analysts now say that hurricanes or not, this year will be different unless OPEC opens the spigot. In fact, Goldman's Currie thinks that if OPEC doesn't "bring on supply by autumn, prices by the end of the year will be over $90 per barrel."
Currie calls the recent shift in the oil futures curve to so-called backwardation, meaning forward prices are lower than current prices, a "full-on bullish" sign. On the other hand, he says that a loosening signal from OPEC would immediately knock $5 to $10 off the per-barrel price of oil, as speculators liquidate their record long positions. But OPEC countries, whose own rising domestic consumption is cutting into exports, may be saving up their spare capacity for a more serious fight.
Not everyone is convinced that the likely trend is up. Indeed, David Kirsch, an analyst at Washington-based consultancy PFC Energy, says prices could even ease by the end of the year. "Supply concerns are somewhat overstated, with crude oil inventories in relatively good shape globally?and ample in the United States," Kirsch says. "We expect prices to ease to an average of $68 per barrel in the fourth quarter." Still, with concern growing around the world about long-term supplies and OPEC firmly back in the driver's seat, the floor for prices seems likely to be quite high for the foreseeable future
Consider this 'Insider Insight'.
When SPC fell from 5.15 in April to 4.70 in first half of May, Chairman Choo made a personnal purchase of 100lots at 4.70.
When SPC fell from a high of 5.85 in mid Jun to 5.50 at the end of Jun, SPC made some share buy back.
Both these events occurred in 2Q......which I interprete as a strong signal by mgmt of confidence in the 2Q performance.
Hi jkbk007...if the EPS for 2Q07 is as mentioned by you to be 23¢, I think lots of people will run road. 2Q06 was 26¢ if I am not wrong. If this quarter is below last year 2Q, I am sure the sentiment will be bad. Recent euphoria has hope that SPC will do well for Q2 due to better Refinery Margin, and pushed share price to current $6.50. I am sure SPC will share price will drop to the 23¢ announcement to maybe $5.70 - $6.00, or maybe lower. Let's hope your estimates is just conservative and SPC will do better than that. I am maintaining 28¢ (minimium) for 2Q07, sorry I sing different tune from you, just for discussion only. Cheers!