HIGH RISK FOREVER
BOE wrote, oil demand should start accelerating by year's end, and outside of Saudi Arabia the prospect for production growth among OPEC members looks bleak.
Oil prices have swung up and down this month following an August rally spurred by speculation that Russia and the Organization of Petroleum Exporting Countries would move to stabilize the market. The countries have fueled the volatility in recent weeks, as they talked of freezing output even while boosting production to new highs.
It predicted a large output contraction down the road with decline rates accelerating at these low prices. While assuming healthy OPEC growth going forward, conservative supply and demand balance continues to point towards hefty stock draws during the second half of the year.
The market remains bullish, onshore visible inventories will draw and oil prices will move higher.
The Commodities Master Fund gained 38 percent in 2014, when oil prices began a two-year slide. In August, the fund gained 4.2 percent, bringing annual returns to 8.3 percent, according to the letter. The hedge fund industry as a whole gained 1 percent in August and is up 2.2 percent this year, according to data compiled by Bloomberg.
Investment in new oil supplies is drying up, thanks to low prices and climate-change worries that are fueling a push toward renewable energy.
It seen 2017-2020 as still having the potential for much higher prices. After 2020, there is a high risk that electric vehicle penetration will change the oil market forever.
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THE LOCAL FRANCE - Angola and French oil giant Total formally launched a major new offshore oil project Saturday to aid the country's economy that plunged into crisis following oil price dips in 2014.
WNN - China's State Power Investment Corporation (SPIC) says it has signed a memorandum of understanding (MoU) for "global cooperation" in nuclear energy with Westinghouse Electric Company of the USA.
WNN - Advanced Nuclear Technologies - otherwise known as small nuclear or small reactor technologies - encompass a wide range of nuclear reactor technologies under development, BEIS noted. "The common attributes that these technologies share is that they are smaller than conventional nuclear power station reactors and are designed so that much of the plant can be fabricated in a factory environment and transported to site, reducing construction risk and making them less capital-intensive," it said.
WNN - Poland and the USA have signed a Joint Declaration of Energy Security, which emphasises the expansion of their cooperation in a variety of areas, including civil nuclear energy. The document was signed in Warsaw yesterday by Polish Energy Minister Krzysztof Tchórzewski and US Secretary of Energy Rick Perry.