The oil price is up a couple of bucks for no particular reason

Three days since the last blog, a number of early meetings and travel have kept me away from the desk so I will do a whirlwind round-up if I may.

The oil price is up a couple of bucks since Monday for no particular reason, traders tell me there is a surfeit of hope over actualité with which I concur. On Tuesday I read an article in the FT by Professor Nick Butler which started with the phrase ‘the Saudi’s blinked’, someone somewhere needs to smelling some coffee and then reading a transcript of Ali al-Naimi’s CERA conference speech. Nothing could be further from the truth and the FT carried an excellent letter afterwards picking many holes in the good Professors workings. In the CERA speech the Minister said that the Saudis had tried to bring Opec and non-Opec together but they had ‘no appetite for sharing the burden’ and that ‘no one delivers even if they say they will’. Cutting production ‘ is not going to happen’ he said, hardly blinking in my eyes, as it were.

The inventory stats were mixed this week, the API showed a build of 7.1m barrels which didnt look clever, so when the EIA numbers came out as only a build of 3.5m barrels it was a triumph. Indeed if you add a 1% fall in refinery utilisation and a draw in gasoline and distillate stocks you can understand why things looked a bit rosier.

Today sees the G20 Finance Ministers meeting where more action is apparently to be decided, whilst there are elections in Ireland and Iran. With slightly better economic data from the US, led by a rise in durable goods orders in January things may be looking up. The final straw to be clutched at by the oil bulls was the announcement that the Venezuelan oil Minister will be topping up his air miles in March by having further meetings with Russia, Saudi Arabia and Qatar, if I was him I would read the transcripts of the CERA conference and stay at home.