Tullow Oil will issue a trading statement and operational update on Wednesday, and traders suggested the capital raising could accompany this news item.
“This would make sense. Tullow needs money to exploit the finds it has made in Ghana and Uganda in the past couple of years,” one dealer said.
Tullow Oil declined to comment on the placing rumour.
Tullow Oil’s shares have outperformed the oil and gas sector in recent months, helped by big oil discoveries in Ghana and Uganda.
Raising capital now could ensure the company has the cash to develop these assets even if bank lending freezes.
Tullow shares traded down 4.9 percent at 601.5 pence at 1619 GMT, compared with a 1.22 percent drop in the DJ Stoxx European oil and gas sector index.