Weak Oil

Crude Futures Drop on Greek Austerity Vote, Rising U.S. Supply at Bloomberg.

Energy chart of the day: US oil output during last week of October was highest weekly production since January 1995 from Mark Perry.

U.S. net petroleum imports were lower by 12% in 2012 through August from 2011:  EIA.

Meanwhile, world demand is weak:  “The Organization of the Petroleum Exporting Countries (OPEC) is putting forth bearish signals on the world’s economy. The 12-member organization lowered its forecast for growth in global oil demand this year and warned of a continued slowdown in 2013.”  Oil and Gas 360

Re-post:  Gold over oil on the charts by Greg Harmon.

Penn West (PWE) is the largest Canadian O&G income play.  Continued lackluster results pushed the stock to new lows, and then yesterday four senior executives were pushed out the door.  PWE has long offered promise with a ginormous asset base, yet the company seems be eating itself to death by continually selling assets to fund the big dividend.

This morning we see long time ISA favorite royalty company Franco-Nevada (FNV) purchasing an oil royalty from PWE.  FNV will discuss the purchase in conjunction with its third quarter earnings conference call this morning.  Seems to me FNV is getting the better end of the deal.

Natural gas a transportation fuel is suboptimal.  Yet it is still a wonderful fuel:  NY Times.

ISA maintains North American NG exports will crash the international LNG price.  “Asian consumers — the world’s top LNG users — are growing tired of paying huge premiums for liquefied natural gas based on a historic link with oil prices and demanding a link to cheaper North American prices instead…”  Financial Post