 Trade group: British oil and gas priorities not changed by election Washington (UPI) Jun 8, 2017 - While the direction of British politics remains unclear, an industry trade group for oil and gas said it was steadfast in pushing for more domestic development. British Prime Minister Theresa May faced calls to step down from her Labor Party rivals after the hold over the majority in Parliament for her Conservative Party slipped as early results from general elections trickled in Friday. In a statement sent to UPI, Michael Geary, a global fellow with the Wilson Center's global European program, said the push for elections by May was a serious miscalculation. "No party will have enough seats to govern alone," he said. "With Brexit negotiations starting in 10 days, the election has thrown the country into disarray." Late last month, polling data from YouGov found support for May was eroding, rattling investor confidence during Brexit negotiations. In commentary presented in late May, trade group Oil & Gas U.K. said it had a blueprint for the future of the North Sea that envisioned $370 billion in potential revenue for the British economy over the next 20 years by tapping into the estimated 20 billion barrels of oil and gas yet to be recovered offshore. Deirdre Michie, the CEO of the trade group, said in response to emailed questions the industry was looking forward to continuing its work with whatever government emerged in London. Regardless of the power structure, the industry is clear on ensuring it can succeed. "To that end, we need a U.K. energy policy which realizes the full benefits of the U.K.'s indigenous resources; to work closely with government to ensure that the U.K. continental shelf is globally competitive for investment, strategic management of Brexit to support, develop and promote the oil and gas industry and practical steps to protect, progress and promote operators, the supply chain and the industry workforce," she said. A March report from the group found total British offshore production was up 5 percent from 2015 to 1.73 billion barrels of oil equivalent, a trend that should continue. That follows a 15-year period of steady declines from British waters. Stephen Brennock, an analyst with London oil broker PVM, said in an emailed newsletter the results of the election has sparked a "fresh period of uncertainty" and "risks throwing spanner in the works of Brexit negotiations."
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Crude oil prices were treading water early Friday after British Prime Minister Theresa May offered assurances of stability following a surprise election outcome.
With less than two weeks to go before divorce negotiations begin with the European Union, May saw her hold on power eroded after snap elections. Facing calls to resign, May took to the podium early Friday to offer assurances about the road ahead.
"This government will guide the country through the crucial Brexit talks that begin in just 10 days, and deliver on the will of the British people by taking the United Kingdom out of the European Union," she said.
Crude oil prices slumped overnight as exit polls showed May's lead evaporating, but moderated in the hour before the start of trading in New York. Stephen Brennock, an analyst with London broker PVM, said that, while the broader market has largely factored Brexit into the equation, May's loss added a "fresh period of uncertainty."
The price for Brent crude oil was down 0.1 percent from the previous close about a half hour before the start of trading on Wall Street to $47.81 per barrel. West Texas Intermediate, the U.S. benchmark for the price of oil, was down 0.11 percent to $45.59 per barrel.
Markets saw some relief as well in easing risk factors that followed testimony from former FBI Director James Comey, who offered no concrete account on whether U.S. President Donald Trump interfered with investigations into alleged Russian meddling in the country's election last year.
Elsewhere, lingering questions over the unity among members of the Organization of Petroleum Exporting Countries re-emerged Friday when Saudi Arabia and some of its Middle East allies put more pressure on Qatar for allegations of support for terrorist organizations. Several of the parties to an OPEC-led effort to balance the market with managed production declines are involved in the dispute, which could dampen the impact of the plan. This week, credit risks analyst warned the situation for Qatar could also deteriorate if the crisis continues.
"The price outlook for this year has been most recently downgraded as doubts grow that OPEC-led cuts will drain the global oil glut," Brennock added in the emailed newsletter.
Markets could be swayed later in the trading day when oilfield services company Baker Hughes releases weekly rig count data. Rig counts offer a loose gauge of industry confidence in a particular sector, and gains in the United States in particular could add to supply-side concerns given the resiliency of shale oil production to lower crude oil prices.
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