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84 comments on Oilwatch Monthly - December 2007

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westexas on December 18, 2007 - 2:25pm Permalink | Subthread | Parent | Comments top

http://www.kommersant.com/p836972/hydrocarbons/
Dec. 17, 2007
Bankers See Grim Outlook for Russian Oil

UBS investment bank has followed Alfa Bank's example and lowered its recommendation for the Russian oil industry. The bank says that oil production will become unprofitable for many companies because of high taxes, capital investments and exhausted deposits.

The pessimistic long-term prognosis was published on Friday. Recommendations for all Russian oil companies except Rosneft were lowered by at least one position. The bank notes that Rosneft had good indicators even without YUKOS assets. . . .

. . . Not all investment banks agree with the UBS assessment. JP Morgan published a rosy appraisal of industry health at the end of last month, and Troika Dialog recommends buying Gazprom Neft. Renaissance Capital predicts that LUKOIL will benefit from tax policy changes by the new government next year.

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westexas on December 19, 2007 - 9:29am Permalink | Subthread | Parent | Comments top

ANALYSIS-Europe refiners look to Russia as N.Sea oil fades
Tue Dec 18, 2007 1:19pm GMT
By Ikuko Kao

LONDON, Dec 18 (Reuters) - Europe will buy more Russian crude as North Sea oil output drops, prompting heavier investment in high tech refineries that can turn the higher sulphur content crude into greener, ultra-low sulphur fuels, analysts say.

That may also make Russia's Urals crude more expensive for European buyers.

North Sea oil output, mostly from Britain and Norway, will fall from 4.88 million barrels per day in 2007 to 3.66 million bpd in 2012, according to the International Energy Agency.

Damian Kennaby, analyst with energy consultancy Purvin and Gertz, forecasts North Sea production will have fallen even further to about 2.7 million bpd by 2020.

"The main alternative crude sources in Northern Europe are Russian and African," he said. "As North Sea production declines we expect that demand will be met by more Russian exports."

Our middle case shows both Norway and Russia approaching zero net oil exports by 2024. I have acknowledged that the Russian outlook may be too pessimistic because of frontier basins, but my WAG is that the new basins are to Russia as Alaska was to the US--very helpful, but it doesn't fundamentally change the long term picture.

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84 comments on Oilwatch Monthly - December 2007

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