10 CHRONICLE Monday 8th September, 2008

Room for Optimism However there are many experts, such as Chakib Khelil from Opec (The Organisation of the Petroleum Exporting MARKET WATCH Countries), who believe that by Mark Maloney Managing Director, the current oil price is not sup- Gibraltar Asset Management Limited ported by the fundamentals of supply and demand, suggesting that the price is hurtling higher on the back of short-term sup- ply shocks and dollar-based speculation. Indeed demand is certainly strong but there is a limit and demand is likely to From $10 a barrel in 1999 to 2) Supply fall off some way short of $200 today’s insane market where There have been many recent particularly in a slowing econ- oil prices were recently mak- supply side shocks including omy. Subsidies that exist in ing fresh highs of $135 a bar- terrorist attacks in emerging market countries rel, many investors are won- and the Grangemouth strike. would also come under pres- dering where it is going to go 3) Peak Oil sure at $200. from here, particularly with It is widely accepted that oil is How to gain exposure to oil the high oil price having such a finite resource, while a major Retail investors wishing to a devastating effect on world oil field capable of producing take a long position can do so stock markets. With the US more than 1m barrels of oil a by buying shares in the oil investment bank Goldman day has not been found for 32 majors such as BP (BP..L) & Sachs predicting oil prices of years - the Cantarell field in Royal Dutch Shell (RDSB.L) or $150-$200 by 2010 are there Mexico. There are some who oil exploration and production valid reasons behind the believe that the production of companies such as Tullow Oil meteoric rise or is this becom- oil has peaked, after which pro- (TLW.L) or Dana Petroleum ing the next speculative bub- duction will now decline until (DNX.L). ble? the resource has been depleted. Investors looking to gain expo- Reasons behind price rise Peak oil production has already sure directly to the underlying 1) Demand been reached in 9 of the 21 oil commodity - without the hassle High demand (partially due to fields such as the North Sea, of complicated futures trading favourable government subsi- which is now in decline. Produc- - can now do so by buying an dies) has been particularly tion also appears to have Exchange Traded Commodity prevalent amongst the emerg- peaked in Russia and Saudi fund listed on the London ing markets of China (con- Arabia has decided not to Stock Exchange such as the sumption doubled between expand output next year ETFS Crude Oil (CRUD.L), 1994 and 2003 and is forecast beyond its current 12.5m bar- which tracks the West Texas to double again by 2010), rels a day. Intermediate futures price. For Economic Outlook 6732.40 reached in October India and the Middle East. 4) Pricing Currency bearish investors who believe 2007, equities are now con- According to the Interna- As oil is priced in US dollars the the oil price will fall the ETFS The first estimate of Q2 GDP firmed to be in a technical bear tional Energy Agency, overall fall of the US currency due to Short Crude Oil (SOIL.L) pro- growth shows a UK economy market. The main indicator of demand will increase from its twin deficits and faltering vides inverse exposure and will slowing with annual growth of the movement’s strength the 85m barrels a day to 118m economy has fuelled speculative rise in value as the oil price 1.6% compared with 2.3% the RSI (Relative Strength Index) barrels by 2030. money into the oil markets. (Continued on page 16) previous year. This is hardly remains weak below the signal surprising given the ongoing dif- level of 50. The index is still ori- ficulties in the financial and ented to the downside trading housing markets. However under its 50-day moving aver- retail sales are indicative of a age located at 5440. Support steady slowdown rather than a lies at 5086 with resistance at collapse in demand. With infla- 5930. tion easing coupled with an economic slowdown expected Investment Theme in the near term, UK base Oil rates are likely to remain on hold for the remainder of Oil has been the commodity 2008 before falling as the BoE stealing the newspaper head- has scope to kickstart the lines for its spectacular rise in economy. price per barrel over the last 18 months, even by its own Equity Technical highly volatile standards. A Outlook recent wave of profit taking however has seen oil prices With the FTSE 100 more than come off, but this commodity 20% off its recent high of still has investment potential. 16 Monday 8th September, 2008 Advertorial MARKET WATCH Traditional banking makes (Continued from page 10) falls. For speculators looking to trade on margin, contracts for differences offer the perfect vehicle for taking a short- a come back at Barclays term view on either side. For further information on these Recently announced changes financial instruments you at Barclays Wealth Gibraltar should contact your have meant a return to the stockbroker. more established style of banking. Simultaneously House View Barclays Wealth continues to redefine wealth management Though demand for oil is in the 21st Century by incor- faltering in the major Western porating the very latest tech- economies that is being offset nology and practices. by strong demand from But reintroducing the tradi- emerging markets. There is tional Branch Manager to the little doubt that, in the Gibraltar branch is the way immediate term, speculative Barclays is investing in its investors are driving up both clientele offering a more per- volumes and prices with sonal service. With more than speculation estimated to 23 years' experience with account for $20 to $30 of the Barclays, Gerald Danino, a current oil price. Thus any passionate advocate of client- wane in speculative interest focused banking, is taking on could take the oil price back this new role. below the $100 level and "Modern systems are there to below. deal with the demands of However with its low today's hectic lifestyle, but correlation to the broader clients need the option of hav- equity market (an insignificant ing someone they can talk to correlation of just 0.11 to the in-branch," he points out. FTSE All-Share), we believe Crucially, clients are now able that a small allocation will to make an appointment to Form left to right: Joe Celecia, Gerald Danino, Roshan Chablani, Christine Bottino, Tracy Wahnon. benefit a portfolio from the see their Personal Banker at a added diversification it time that is convenient to Mr Danino is confident that now access to a wider range including the South District. provides, which should provide them. these changes will have a of Barclays Wealth products Derek Sene, Deputy Head for some protection in the current Barclays Wealth has also major impact on the way and services, some of which Barclays Wealth in Gibraltar bear market. introduced other measures to clients carry out their bank- are available for the first time. emphasises that this invest- You should always seek improve the client experience: ing, "This is the way we will Also key to these plans is the ment reflects Barclays confi- appropriate investment a disability till has recently provide them with a world introduction of new technolo- dence in Gibraltar. advice. The value of been introduced to the class service." gy in a number of areas to "We are delighted to be mak- investments can rise as well Banking Hall, and a Customer Barclays Wealth has been make transactional banking ing these changes to our tech- as fall. Liaison Officer, Alastair investing heavily in new tech- more fluid. These include a nology systems and extending McLoughlin, who has been on nology as part of its ongoing superior online banking facili- our offering in Gibraltar," he hand for the past few months, commitment to providing the ty that will be complemented said. guides visitors when they highest levels of service. by telephone and personal "Our state of the art banking arrive at the bank. Clients in Gibraltar will have banking services, providing platforms will provide our 24-hour access to account clients with world-class invest- details, online statements and ment expertise, which, com- payment facilities, dual cur- bined with the excellent local WOMEN IN NEED

rency services (sterling and knowledge of our team here 24 hrs helpline for victims of euro) on all ATMs now based will see clients benefit from a Domestic Violence. Free confidential counselling service in new areas of Gibraltar market leading service." is available by appointment. DAY TRIPS Tel: 42581

Saturday 20th September Contact: DANZA ACADEMY Anne- Marie Gomez 200 44828 Aqua Park Mijas Zulieka Green 200 45628 68/2 Prince Edward’s Road 54003973 Price: £17.99 Adult • £17.49 Children Autumn Term Begins: 15th September 2008 Please ring for new timetable. Professional studio including showering facilities/ Sprung Flooring & Mirrors. Saturday 20th September DANCE: The Academy offers professional dance tuition for Girls and Boys aged 3+ - Adults Advanced Vocational Examinations. • Classes in Classical Ballet leading towards the prestigious UK validated Royal Academy of Dance Exams. Miramar & Dunne Stores • Classes in Modern Theatre Dance styles leading towards UK validated Imperial Society of Teachers of Dancing Exams. • Open classes in Contemporary, Physical Theatre, Jazz, and a variety of Post- Modern Styles. • Choreography encouraged within class setting, Annual Choreography Competition and ample opportunities to display these. (e.g. Summer Price: £9.95 Nights). • Excellent local performance opportunities (e.g. Prince of Egypt 2008, 2008, Model Search 2008 and Runway 2008). Saturday 27th September • Excellent results at local competition. 2008 MO Stage Festival Best Male & Best Female, 2nd Place at Starsearch. • Excellent performance opportunities in Spain. Winners of Fuentes Baile 2004, 2005, performed in ‘El Metro’ 2008. • Specialised training for International Competitions with Excellent results. Students have reached I.D.O. World Dance Championships finals Primark Jerez - Area Sur for the past eight years. 2005 I.D.O. World Champions Children’s Duet, 2006 I.D.O. World Champions Children Female Solo, 2007 3rd Place Junior Solo Male & 6th Place Adult Group Piece. Price: £9.00 • Specialised Preparation for Auditions. Many past pupils have now completed Dance Degrees. • Hip Hop Classes with Jade Federico. FITNESS CLASSES: Step, Aerobics, Weights, Elastics, Ball, Circuits and Stretch. Friendly classes that really work. A place for everyone regardless of age or fitness level. Mornings 10 to 11.15 am. Afternoons 2 to 3 pm. Evenings 8.15 to 9.30pm. Millennium Travel 6, Cathedral Square, Gibraltar Highly Qualified Experienced and Professional Teachers: Tel: 20076070 & 20070563 Anne-Marie Gomez Zulieka Green a division of Fax: 20040054 B.A. (Hons) Dance in Society B.A.(Hons) Dance in Society P.G.C.E Dance, R.A.D. Registered Teacher P.G.C.E. Dance. e-mail: [email protected] I.S.T.D. Associate, I.S.T.D. Associate Diploma I.S.T.D. Modern Advanced 2 (Hons) Y.M.C.A. Fitness Cert.