My transaction costs ie stamp duty, brokerage etc is about 1.3%. So to trade ie sell now and buy later works out to about 2.6%. Tried to time the market before and lost out. So for now I’m holding on to my 3000+ shares in Shell. It still feels like it has legs to run and if the dividends go back to pre-pandemic levels, it could even go higher. £30 may be possible, so I guess I’ll hold on for now. If you decide to sell , then just walk away. Don’t try to trade it at these levels, may not be worth the transaction costs.
Best case scenario is that some of the money flowing out of growth stops and Faang find their way into big oil, including Shell and keep this energy stocks rally going. Still hoping for 25 pounds sooner than later.
I read somewhere that oil prices had been above USD100 per barrel between 2011 to 1H 2014 but halved in 2H2014. I wonder how long it will stay above USD100 this time.
Just Google it and found this:-
"After peaking at $107.95 a barrel on June 20, 2014, petroleum prices plunged to $44.08 a barrel by January 28, 2015, a drop of 59.2 percent in a little over 7 months."
Washington Posts had this to say in 2014:-
'The law of supply and demand did it. The price collapse mainly reflects too much supply chasing too little demand. Most analysts have focused on surging U.S. production of “shale” oil, which has increased by 3.5 million barrels a day (mbd) since 2008, according to the consultancy IHS. But the U.S. expansion was widely anticipated, says economist Larry Goldstein. The real surprise, he argues, was lower-than-expected global demand. In early 2014, forecasters predicted growth of 1.3 mbd, says Goldstein. Actual growth is about half that, 700,000 mbd, reflecting unpredicted economic weakness in Europe, Japan and China.'
I don't see supply going up any time soon but demand may fall if the major economies go into recession.
2022 will cerainly be an interesting year for Shell and Oil.