CGES Monthly Oil Market View

JAMES LONGMORE | JULY 2010 | SOURCE:

The past month held few surprises as far as the oil price was concerned, with the main benchmarks continuing to trade within the $70-80/bbl corridor that has been a feature of the second quarter of 2010. Given that crude and oil product stock levels remain close to record highs and that the market is fearful of OPEC’s reaction should prices fall much below $70/bbl, it is not surprising that this equilibrium is prevailing.

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However, there have been important recent developments in the industry. BP has now succeeded in stopping the flow of oil into the Gulf of Mexico, roughly three months after the blowout at its Macondo prospect on April 20th. BP’s board clearly feels a new chapter has begun, as demonstrated by its decision to remove CEO Tony Hayward, who will be replaced by Mississippi-raised Bob Dudley in October...