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Happyinvestor,
The question has been addressed many times yet you still seem not to even consider to hit the pause button and try to review topics with a different pair of specs. You went on marking threes by calling people who are concerned about the environment for our future generations " three hugger" then one of your compadres went on saying he was an "old school oiler" and was furious with Looney because the timid raise in crude prices were not reflected directly on BP share price, made some silly reasoning sold BP and went all in on IAG.
You belong in the past, I will put it politely BP it's not for you.
Hi. Happy. I think you are wrong regards the use of hydrogen for mass transportation, trains, large and small cargo vessels, cruise ships,planes ,trucks, delivery vans and buses will all eventually use hydrogen IMO. Not so much with small individual cars and vans as they will be EVs. Oil will still have a place but over time will be used less and less. You are correct it is not Loony job to save the planet, that is a job for all of us. ATB Speedy
You didn't really address the point? What do mean by "sink" and over what time horizon? Much too vague. But we live in an age of hyperbole in which things "plummet" and "sink* rather than fall. Precision matters.
What makes you think Exxon and Chevron are wrong bad and BP / RDSB are right?
If BP and RDSB bet on oil and are proved wrong, that's OK by me because as an oil and gas investor, I choose to take that risk. However, I did not choose that they pursue some nebulous ambition to become a renewables company.
I don't think it's all about demand, more to do with the supply / demand ratio that will determine the barrel price. You can still make money on falling demand if the likes of BP et al are cutting exploration / drilling CapEx, market forces will come to the surface. FWIW, I do think BP's switch on emphasis has come at exactly the right time, although it will take many years for them to streamline their portfolio by disposing of high cost, low margin fields .... their call has been made and I'm sure it will prove to be the correct one.
aimo
Far too many references out there to share links, both analytic and scientific for oil demand sinking in the coming decades.
But sure, you can dispute it, even King Canute was right for 30 minutes each time the waves retracted as the tide came in.
"Long term oil demand will sink, this surely is not in dispute. BP have decided to act."
I dispute it. Exxon disputes it. Chevron disputes it. What is long-term? What do you define as "sink"? These aren't pedantic questions, precision matters because we are talking of forecasts long into the future that are susceptible to small changes in assumptions. Even if total demand declines steadily over time, those companies that continue to invest may reap handsome dividends as supply becomes constricted and the oil price rises.
BP and RDSB are making a huge gamble into an area in which they have no competitive advantage and in which the winning technologies are far from certain for example, I don't think hydrogen will ever be commercially viable for mass transportation).
I understand that EU regulations are tightening for fossil fuels and BP and RDSB are looking to act preemptively before politicians take the matter out of their hands.
However, BP's strategy goes too far because the priority seems to be kowtowing to the green lobby rather than maximising shareholder returns and minimising risk. Saving the planet is not Looney's job.
Best
Happy
"' 17.5 bn of assets deemed economically unviable - which numpty is going to buy em."
BP are basically stating that these assets will be gone on the the next spike up in oil price, they will take the long term view that Oil is set to go lower in price. That said the stars are aligning for a rise in oil price (so say the analysts) for will last some years before it sinks again during another energy crisis. So, just as when the gold price goes up, companies see old expensive mines to be viable again, so will be the case with oil fields that need a price above $55. BP will sell these to plenty of buyers, who'll be in glee to please their stakeholders with the promise of more profit.
Long term oil demand will sink, this surely is not in dispute. BP have decided to act.
Many years ago it was unthinkable that the national grid could take any significant power from clean sources such as wind, yet it was recently 100% powered recently by such sources.
Some assets are worthless to one company but another wilt different strategic aims, infrastructure, expertise, supply chain etc can release its value
"Fossil v renewableSat 09:30
The bit that puzzles me is that if it's going to sell off 17.5 bn of assets deemed economically unviable - which numpty is going to buy em."
Plenty of buyers trust me. As a starter all the ones skeptical and in denial of the new transition and status quo. As I stated many times before if all the majors are running the same game plan there is a well solid reason for that. So stop making it look like Looney is the village idiot, it's not him,he is running a multi billion company " Daft CEO" LOL, check your achievements gents you will not get there in million years. 2020 and still reading the"fool tips" and thinking a drilling hole out in Angola will make BP profitable? Good luck.
There are companies that can make oil fields that are marginal profit for the super majors to a greater profit. You only need to look at SQZs acquisition of the BP et al BKR assets. Driven the cost down to $12
I get your point but it seems a lot of money tied up until 'someday'. Wouldnt be for me
Someone who believes oil is going to remain viable, and that will too many majors reducing their oil holdings, the price is likely to go up someday.
The bit that puzzles me is that if it's going to sell off 17.5 bn of assets deemed economically unviable - which numpty is going to buy em.