Rates for offshore rigs improved and the amount of downtime fell between April and June, helping to buoy offshore drilling contractor Noble Corp. to higher-than-expected profits.
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The move by U.S. explorers to oil plays, and by implication, the oilfield services business, will buoy Schlumberger Ltd. into 2011, but higher natural gas demand is required to keep up the pace in North American natural gas drilling “beyond a certain point in time,” CEO Andrew Gould said Friday.
The move by U.S. explorers to oil plays, and by implication, the oilfield services business, will buoy Schlumberger Ltd. into 2011, but higher natural gas demand will be required to keep up the pace in North American natural gas drilling “beyond a certain point in time,” CEO Andrew Gould said Friday.
Apparently any “storm hype,” which seemed to help buoy the market earlier in the week, was getting totally dismissed as prices sank at all but one point Friday, most often by double-digit amounts. Instead, the near-imminent diminution of most remaining cooling load and the weekend factor of considerably lower industrial demand were more persuasive to traders in sending cash prices lower.
Fueled by the season’s first hurricane hype and gains tacked onduring the Wednesday evening Access trading session, natural gasfutures gapped higher for the second day in a row yesterday asshort-covering and fresh buying created a tempest of bullishtrading activity. That buying pressure continued throughout much ofthe session, allowing the September contract to notch a new high of$2.905 before finishing at $2.898, up 10.6 cents from Wednesday’sclose.
After slipping more than a dime Thursday, the futures marketcontinued lower Friday morning as traders continued the process oflightening their long positions. The July contract carved out a$2.325 low before 11 AM. That, however, was about all the sellingpressure the market would tolerate and scaled down trade buyinglifted the market throughout the rest of the day. July finished at$2.378, up 2.3 cents. Estimated volume was light, with only 45,070contracts changing hands.
“Dead” was the popular word used by traders to describe thestagnant cash market Thursday, where prices showed very little, ifany, change from the prior day. Most sources believe that shortcovering is the main factor helping cash maintain current pricelevels amid the lack of any meaningful fundamental support.
What a difference a week can make. Bull traders, nearly ready tothrow in the towel a week ago, have become “cautiously optimistic”higher prices are in their future. And they have good reason tofeel that way because the market entertained a flood of positivenews last week, which gave bulls and bears alike little choice butto bid the market higher. The April contract broke above the 40-daymoving average at $1.80 on Friday and was propelled 5 cents higherby speculative fund buying to finish the day up 9.8 cents at$1.853. Volume was a heavy 108,348. For the week, April gained 22.5cents.
Tuesday’s cash market prices shrugged-off a late plunge on theNymex futures screen on Monday, as they edged upward on hype fromthe first big snowstorm of the season. Most price points added acouple of cents to Monday’s gains as a powerful storm system plowedeastward after tormenting the midsection of the country. Accordingto weather services, several inches of snow accumulated from theDakotas southwestward to Colorado and the mountains of northern NewMexico and Arizona.
Natural gas futures looked poised to continue to trend lowerlast Friday amid abundant physical supply and having justreestablished the downtrend that began on April 8th. However,weather forecasts calling for the warmest temperatures of thesummer and solid “bargain buying” in the cash market was enough tolift August 3.3 cents to settle at $2.165.