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Hi Boyo,
Your right but the point is still the same the Saudis need oil over 80$ to balance their book.
And they are committed to keeping prices higher than current levels.
Interesting times........
Hawkey
Saudi Oil production at $4:
Saudi energy minister Khalid al Falih also said that the audit determined that Aramco, Saudi Arabia's national oil company, has the lowest cost of production of any oil company, at about $4 per barrel. This makes Saudi oil the most profitable in the world. (Forbes 9 Jan 2019)
So oil needs to be at least 60$ and for some countries such as Saudi much higher (80$) ......
Be careful not to confuse the cost of production with the need for national revenues. Saudis could pump many producers to extinction based on their production costs alone. It's their economy and their capacity limits that held them back last time they tried it.
Hi Ocelot,
Can buy any more until end of Oct but if still around this price will be buying big time.
Holding up very very well so far today.
The thing to remember and its very very important is that NOBODY NOBODY can explore and produce at low oil prices, not the Saudis, USA, Russia and really not even us.
So oil needs to be at least 60$ and for some countries such as Saudi much higher (80$) and we break even at 20$...........
That says it all really.......Keep the Faith.......
Hawkey
Hawkey: Ooops. This time having bought at 203 and 230 ....
If it's any consolation, H, I still have a bunch of G shares at an average cost of 224p mostly acquired at the end of last summer. Even though my overall average cost is now back below 120p, I never loose sight of the ones that haven't 'paid their way' and will trade them for a profit at an appropriate time.
Buying as the sp comes up to a resistance level (like 230) is riskier than buying once it has gone above it and, hopefully , establishes it as a new support line. Equally, buying as the price drops to a support level (like 203) comes with the risk that the price will drop through - often worth waiting to see how solid the level is. Keeping some cash available and not being afraid to bail out if things go wrong can rescue a situation and help keep the average cost of a holding down. You, and a lot of us, were unlucky with 203 because the OP drop from $70 was sharp and largely unexpected and it came on the back of an already steep decline in SP. But by keeping cash back I was able to buy at the lower levels and turn a short term failure back to a profit - recently selling them at the top of the buyback price. Waiting for the max price when selling or the min price when buying rarely works in my experience - I just aim for good buy/sell averages. ATB
I can't agree with you, JL, about the buybacks not working. G produces and sells oil and is small relative to the likes of RDS - which can manage and hedge oil sales etc and play the market to make a profit whatever the OP. So G's sp will be more closely geared to OP and buybacks can only shift the price range relative to it rather than limit potential drops. Since the buybacks finished Brent has dropped back to $64 a price at which G just managed 176 on a good day prior to the buybacks. So the shares are about 15p up comparatively.
The buybacks were intended to be value accretive for the company and it's way too early to make a judgement on that. In any case, they have plenty of scope to continue the buybacks after the H1 results if they still feel the company is undervalued.
As Hawkey and Hydrogen have pointed out, there should be solid 'balance sheet' news (as opposed to intangible promises) on the 6th to underpin the price and hopefully raise it to a more appropriate level.
Can you buy some more and help to raise the share price, please, Hawkey? :-)
Ooops.
This time having bought at 203 and 230 I have some hefty losss at present but given timescales and the current situation both in Kurdistan and with the company prospects I am more than comfortable where we are.
I also think that the buy back was successful but given weakening oil and summer volumes aligned with our closed period havent finished their mission.
Very very comfortable where we are and I have a very decent sized holding in Genel.
Hawkey
This time having bought at 203 and 230 I
Well as you probably guessed the buybacks while the right move on the fundamentals (boost to eps) has now cost us money, some 6 below the avc.
So, in the short term that did not work. As the payment of dividends didn't work either, not that I expected it to outside of possibly attracting income seekers.
I ask you wtf does work here? There has to be better opportunities elsewhere than being hog'tied to an unloved, unappreciated Kurd o..lie.
I shall def be looking to put all my money into Co's with massive debts, zero revs and profits, dont waste money on dividends or buybacks but milk invstrs by continual cash raises, that's def the way forward. I'll make a fortune.
How come nobody thought of this....oops they have those pis are the ones making money!
If your avc is in the low 100s your probably feeling a bit twitchy having seen a recent 270+ but anyone over 225 will be considering (if not already) cutting losses. Sticking through thick and thin with G has been very costly if your entry point was in the 200s+. I can't remember my avc but if I had still been holding i'd be something like £30k+ down the khazi.
At least I saved myself something. I have clawed some back since but you could say I sold too late, but better late than....
I don't envy those with serious money in here who are sitting on big losses. Gluck!