US rig count drops by 73(26 oil, 46 gas, 1 misc.), but the number offshore rigs is up by two. Drilling activity in the United States is now at a 4-year bottom.
Some have noticed a correlation between the price of oil and the Baltic Dry Index and assume that now the BDI has climbed to a three month high, the price of oil will follow up as did in the first half of '08. The BDI/oil price correlation was logical a year ago when the oil supply and demand situation was tight and the global dryshipping fleet is a significant consumer of oil. Today there's a big gap between the supply and demand. Inspite of the drop in drilling activity I still don't think that an equilibrium will be achieved before midsummer and that sustainable upticks are possible.
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