MasterMetals: OIl COLUMN: Oil rises as rig count declines

April 13, 2015

OIl COLUMN: Oil rises as rig count declines

The oil price stayed firm on Monday but experts reckon the continued glut will likely keep a lid on rises.

Brent crude was up 0.73% to stand at US$58.29 a barrel, while West Texas Intermediate was up 1.10% to trade at US$52.21 a barrel.

Sentiment has been boosted by news last week of a decline in the rig count; the count eased 40 to 988.

On the other hand, the US Energy Information Administration is predicting that the average US household spend on petrol – or gasoline, if you prefer – in 2015, will be US$1,817, which, if accurate, would be the lowest level for more than a decade and sharp drop on spending in 2014.

Most of that can be ascribed to falling prices, which do not seem to be encouraging US citizens to use the car more (assuming that is possible).

On the corporate front, there have been developments in the Falklands, where Argos Resources' (LON:ARG) has farmed out its acreage in the North Falklands Basin.

Noble Energy and Edison International will take over ownership of the licence, PL001, in return for drilling one exploration well plus a chunk of back costs already incurred.

Closer to home, UK Oil & Gas (LON:UKOG), operator of the Horse Hill site in south east England, said it now owns 100% of the Markwells Wood discovery in the Weald Basin. It snapped up the remaining 40% interest in Markwells Wood, also known as PEDL126, from Magellan Petroleum.