Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
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We are sadly at the very very bottom of the table in payouts…
Hopefully dividend will increase this year….
Plenty of oil and gas here.....
https://www.nasdaq.com/articles/shell-shel-secures-natural-gas-production-license-in-venezuela
Https://www.offshore-technology.com/news/qatarenergy-crude-deal-with-shell/?cf-view
At this time of year, I review my investments for the year now nearly over and my investing plans for the forthcoming year. I don't know how many others do, but if you don't you should. we can all learn from our mistakes and try to make ourselves more effective investors. While I'm not invested here, currently it sits on my watch list like almost all of the FTSE 100. I intend to post my thoughts on this and a few other boards in the next few days and would welcome others doing the same.
Worth a read:
https://www.lse.co.uk/news/SHEL/big-oil-enters-2024-strengthened-by-us-industry-consolidation-7cv5wm38x6wfs2y.html
MERRY CHRISTMAS to all Shellers. hope to see £28+ next Year. Ive now put around 60% of My funds into BP. of course its gone down ever since. All seems well with shell , since the new CEO came in. good luck everyone
Glutton for punishment, added again.
happy xmas / NY etc.
Added for 2024.
An interesting time in terms of Shel's sp:
https://invst.ly/12mkh4
Red, Green or Blue? They can't all remain intact into the New Year.
The West is in an interesting dance with China economically, Getafgrip. Each is too dependent on the other to let the music stop.
Https://finance.yahoo.com/news/shell-shel-plans-two-well-121000503.html?guccounter=1&guce_referrer=aHR0cHM6Ly93d3cuZ29vZ2xlLmNvbS8&guce_referrer_sig=AQAAACkod1TrQXTtEJiM4ssNslL0sJgjVLPju4yEqhAkyiqhGaQNxLaFlJEYiXwR4kS_QU7mFaF7nrDM668wHmE5u1FohsRriKVKRerZOhGRPHg45BpsSjxwFYwbI31uHyQqvfzzNVgi4E40TZHUvrBYndQ2rVu9wN_qReGiFJ4l9-pl
Boyo - I largely agree with your statements on Bonds. The point where I think the dynamics change with Chinese Government US Treasury holdings, is that primarily with the increase in interest rates the cost of low-coupon US Treasury bonds has fallen off a cliff leading to serious Chinese losses.
Although this does not change the facts relating to the Bond market that you outlay. By way of illustration: although the coupon remains exactly the same until maturity, if say $1000 worth of Chinese Government investment in 20-year US treasuries fell by half to only being worth $500 - although the coupon is the same, the new buyer of $500 worth of bonds can effectively buy twice as many for an outlay of $1000 & double their coupon receipts through astute buying.
I would see it as potentially inflationary if the Chinese Government was totally committed to maintaining very high holdings of US Treasuries with a coupon rate of return as close as possible to the "newly" prevailing market rate. Because, this would entail buying large numbers of the latest issue US Treasuries at premium rates.
The Chinese Government has been reducing the level of US Treasuries held from the $1.3 trillion it hit in 2013 though, so that it begs the question is this their overall policy? Until now they have been helping to fund the US National Debt in order to enable the US consumer to purchase massive amounts of cheap Chinese manufactured goods!
The Chinese may see a downturn in their manufactured exports & are trimming their holdings of US Treasuries in anticipation. Or following Biden's attempts to weaponize the US Dollar against Russia, they may be trying to de-risk even the possibility of the US threatening anything relating to the best part of a $trillion of US treasuries held by the Chinese.
Ultimately the current chaos in the Bond markets will impact on demand/growth and the world oil markets, with the only safety valve being reductions in interest rates & inflation.
Oh my….. I hope they have done their due diligence…. Nigeria has been a millstone for Shell.
I agree.
Moniman - I am convinced the whole 7/10 was a Putin Plot to harm all democracies, so he and other dictators can point to our instability. The Arab ME peace initiative was a direct threat, and the best way was to do something SO monstrous Israel (and the West) would have to react - and our "Useful Idiots" took to the streets. Joining the Arab street in celebrating the horrors BEFORE Netanyahu moved. Smashed the strong, anti-Likud Jewish peace movement, too.
A bonus - the Putin/GOP faction stop Ukraine support. Possible get Trump back? Job done, democracy dead.
Appalling "My" Leftist tribe have mostly fallen; Muslim street hate Jews - their friends, did they but know it, in ridding them of Hamas.
I’m not sure it would fuel inflation Getafgrip but I’m not too familiar with the bond market. I’ve always simplistically inked inflation with money supply - so, for example, when the UK started chucking extra money into the economy during COVID it wasn't too surprising for me when inflation came later down the line after about 18 months. It suited the central banks and others to blame high fuel costs, of course. But the simple fact is that money that isn't earned is surplus and fuels higher prices, which only the rich can afford, whilst the poor have to go without.
Isn’t the problem with low coupon bonds that they give a poor return (yield) for the capital originally invested in them compared to newer higher coupon bonds. Selling them off doesn’t change the coupon - which is fixed - so they can only be sold cheaply in order to attract a buyer that then gets a more attractive yield in line with the current market? The loser in this situation is the seller which, in your scenario, would be the current Chinese holders who would receive fewer dollars per bond than they bought them for. When the bonds mature the new holder gets more than they paid for them and that gain matches the loss of the previous holder(s). No extra cash is created so there's no inflationary effect (unless I've missed something - which is quite possible!).
End of week and, despite the 6% overall drop in OP (it was 9% at one point), Shel is less than 2% down since last Friday : https://invst.ly/12leqq
I'd put money on it that Russia supplied arms to Iran and then Iran supplied them to Hamas and Hezbolllah terrorist groups. Putin is definitely behind the October attacks in Israel as he's looking to cause instability in the middle East in a desperate bid to raise Oil prices. Remember Putin ordered poisonings in Salisbury and London also he was behind the genocide in Syria. I don't think it will work as the world is awash with oil and gas now.
Countries like Russia Iran, Iraq, Nigeria and Venezuela etc are desperate for huge amounts of cash to prop up their ailing economies, Russia especially needs the money to fund at least $1 billion a week its costing to fight the war in Ukraine, the price embargo on Russian Oil and Gas will ensure an over supply from OPEC plus members. The fact that the USA is pumping Oil and Gas at all time record levels will ensure Oil prices stay low, but then again you have to ask is it Russia and Iran behind the attack on Israel back in October to raise global Oil and Gas prices again, I think it was!
Boyo - I read through your posts and then went back to them. Very informative, great analysis, but the historical perspective is difficult to beat and helps to cast light and sense on the current situation.
Biden is at war with the OP on every controllable or influenceable front. Will the trend line end with the US election? Will there be a significant OP event that throws some of his toys out of the pram. that's the joy and uncertainty of commodities trading.
I think the only thing I would add to your analysis are a few thoughts on China, banks and bonds, that are a bit like part of the background wallpaper to the current economic situation for me. Influences that are largely suppressed by the weird Chinese "command" economy.
Demand, or stimulating it, looks to be a current issue with the Chinese economy. The real-estate crisis alone is a monster as it comprises an estimated 40% of Chinese GDP. They have a massive trade surplus with the US, which because goods are paid for in USD leaves Chinese manufacturers with a massive surplus of Dollars. Their workers then need paying in Yuan, so the Chinese banks exchange the US Dollar holdings of the manufacturers to Yuan for them.
This leaves the Chinese Banks with enormous regular holdings in USD. For decades they have bought "ultra-safe" US Treasury Bonds, making them the biggest foreign holder of US Treasuries after Japan - $1.3 trillion in 2013, but still the best part of a $trillion now. The problem, in common with the US Regional Banks and many others, is that most of their holdings are long-dated low coupon bonds. Compare this with the newer higher coupon bond issues and which would you want?
If the Chinese dump them on the market en masse, the effect will be to force down the price of these bonds, thereby forcing up the interest payment on the bonds, and forcing up inflation. If Chinese labour then became more expensive to the US the US would buy less Chinese goods, which it would take away cheap Chinese imports that benefit US consumers.
The prospect of not containing the contagion from the issues with holding low-coupon bonds, for the Chinese Government, investment banks, hedge funds, and world banks generally, can only be alleviated with lower interest rates & inflation. Until that time it is a spectre at the feast for the bond market & futures market. And this will cast a shadow over any forecasts of rising oil demand for a time.
''The world still needs more – not less – oil over the next seven-to-10 years, IEA wants Oil companies to invest more in areas like offshore wind, however, oil and gas is vastly more profitable.''
Where to invest simply depends on the profit – and, for now, oil and gas is vastly more profitable. A few years ago, BP and Shell announced big plans to invest in green energy, while scaling down fossil fuels. Since then 'green' returns have disappointed, and both companies have turned back to an oil focus.'
The potential for years – if not decades – of healthy oil demand means that there’s little incentive for oil companies to divert into less profitable or loss making green ventures
https://www.bloomberg.com/opinion/articles/2023-12-07/exxon-chevron-and-shell-can-t-lead-the-green-energy-transition?srnd=premium-uk
The fall in OP stopped last night at the bottom blue trend line here, which goes back nearly three years:
https://invst.ly/12l1bk
It could prove significant if that bottom trend line were to be broken by the combination of high US supply and low US manufacturing demand but, for now at least, OPEC+ appears to be controlling the bottom limit.