Member Info for Boyobach

Cheers Leem - I was about to pose this question,as it happens:
With Labour Day comes the end of the US Driving Season and a switchover in refined product demands. So where will OP head now?
Trends, like rules are there to be broken. Here’s a ten year view of Brent:
https://invst.ly/bzf8o
It’s hardly any wonder that smaller oil co’s like G offer a decidedly choppy investor experience when the underlying commodity is so volatile because the market for it is rarely balanced. One of the shorter term trends (dashed) should be first to go but which one? And will OP stick to the neat shaded four lane highway or take yet another detour? Has anyone seen anything even remotely bullish about OP recently?

To save watching OP and the sp all the time, and reading guff like this, here’s my entirely amateur suggestion for a quick ‘once a day’ check that should tell you a lot of what you need to know about G’s sp (today’s rounded values inserted):

G’s sp, rounded = 179 = A
Brent, rounded = $59, x3 = 177 = B
A-B = the score = 2
0 to +15 is average,
+15 and over is good,
Below 0 isn’t.
Below -15 seriously isn’t!
If that happens OR if the sp goes below 160 ask yourself why you are still holding G.

If the score consistently hits over +25 or more for a month then increase the multiplier by 0.5 and the +/- indicators by 5 and continue but never drop them back! Should be good for up to x4 - not that I think you'll be needing that anytime soon.

Here is the last five days for G/GKP/DNO v Brent(LCO): https://invst.ly/bzefv
Despite some buyback action last week, G had slipped relative to Brent by Friday and there was a brief correction in price at this morning’s open. However, broader market jitters took it back down along with the other Kurdys. Although there was a mid-day recovery, it remains down relative to Brent and the other two over the five days, with the ratio staying close to 3x. So, if buybacks were happening today (there was little sign of them) then they haven’t matched selling pressure since last Wednesday and we should anticipate a pull back when they cease.

No joke, bunks. G always was PMO, it seems.....
https://invst.ly/bzaol

Ha! Whitehat - I nearly did type fork handles but wasn't convinced the reference would be recognised.

Anyway - on obvious typo in the article: 'The most notable recent example of this was just after the KRG’s independence vote in September 2014' .... it was of course 2017.

Iran is a major meddler in Iraq as it is almost everywhere in the region. The pressures they bring are many and, I'm sure, not always as reported. The Barzani's are still powerful aren't they? I'm equally sure that KRG sources would point to Baghdad, under Maliki, for failures regarding the budget - they'd almost certainly say they had no alternative but to sell oil themselves because he withheld the budget. As I recall, Soleimani had a 'serious chat' with the Talabanis (powerful in Sulaymaniyah province) around the time of Abadi's military response to the referendum. I believe he outlined his military threat to their forces in the region of Kirkuk and it was their effective capitulation, rather than anything else, that seemed to split the Kurds and cause the collapse of Kurdish resistance and ambitions. Here's a quote from the Guardian at the time:
'While Iraq’s military indeed played a prominent role in reclaiming Kirkuk, so, too, did Shia groups who report to Suleimani and the joint leaders of the PMU forces, Hadi al-Amiri and Abu Mahdi al-Muhandis. Days before the referendum, it was al-Amiri who sent an envoy to Barzani threatening “war” if the poll went ahead. Suleimani also sat opposite the de facto Kurdish president to try to dissuade him, according to a senior Kurdish officials. When that did not work, he requested – and was refused – a second meeting. And, over the past two months, he had been a regular visitor to the rival political camp in the Kurdish north – the Talabani family, in the region’s second city, Sulaymaniyah.'

All I can say is that Federal Iraq appears to be a hotbed of corruption, nepotism and tribalism with each faction probably as bad as all the others. It will not be unravelled any time soon. The one common factor is that they would all undermine themselves if they impeded the flow of oil - so, to that extent, let them get on with it: Don't mess with Mesopotamia the birthplace of civilisation and all the sh-t that seems to come with it.

Morgan Stanley cuts 2019 oil prices outlook on demand, growth concerns
https://www.nasdaq.com/article/morgan-stanley-cuts-2019-oil-prices-outlook-on-demand-growth-concerns-20190828-00139

The report doesn't make it clear whether MS's estimate of $60 for Brent is for the last two quarters or for the whole year - If the latter, then it doesn't entirely make sense because it puts WTI's average at $55 for the last two quarters. So, for Brent to average $60 over the whole year it would need it to be trading at WTI levels for the remainder of the year, which doesn't occur because of, amongst other things, shipping costs. However, it does seem to suggest that Brent could well remain in the $58-$60 region.

For the market, Hawkey, G is currently all about OP and sentiment rather than reasons to be cheerful.

I think it's worth keeping a close eye on things, bearing in mind that OP has a seasonal tendency to peak and then subsequently fall back during the next two or three months.

Here is the last week for G/GKP/DNO v Brent(LCO): https://invst.ly/bz0c9
with only DNO traded on Monday because of the BH. Buybacks were apparently only conducted during two of the four days which, perhaps, explains G slipping by 1.5% whilst the others, including Brent, gained over the period.

Unfortunately there is no obvious sign of enthusiasm for G in what is already a weak market. When we look at the same three v Brent since G’s buybacks first started the picture is deceptively encouraging:
https://invst.ly/bz0b5

This shows G keeping pace with GKP but, in reality, whilst the first phase of buybacks, which ended in early July, boosted G by 10% relative to Brent, the second phase has added nothing further - indeed G has slipped back slightly. Where would G have been without the buybacks? If DNO offers a clue then that’s pretty grim because, even at half of DNO’s drop, G might have been around 160p today.

The G v 3xBrent chart gives a more rigorous guide: https://invst.ly/bz07z
Here we can clearly see when G drops below the green indicator line (3xBrent) and how badly last week (the last four candles) compares with the previous week. There’s also that steep downward trend - the orange line - putting a lid on things, with the sp squeezed into that wedge pattern from which it must, inevitably, break out - either up or down.

Meanwhile, September should be a relatively strong month for oil prices according to seasonal precedent but, despite a few days of rises, there’s no real evidence of it improving sufficiently to break out of its four month downward trend https://invst.ly/bz00a ,with $62 representing the immediate trend ceiling, potentially falling to $59 by the end of the month - so G’s immediate prospects for 190 + look decidedly poor unless the buybacks start to have a more tangible effect. I believe there is still over 45% of the budget so, if I’m right, they’ll need to spend over £300k a day to use it up by close of play on the 17th. I guess that might shift the price.

Finally, here are all the usual runners:

G/GKP/DNO/RDS/PMO since April 2019 Peak Oil: https://invst.ly/bz091

PMO is bucking the trend, apparently on the back of a ‘good news’ week involving ‘bumper production’ and the sale of an offshore Mexico interest - potentially reducing its fairly hefty debt burden.

Hawkey - Didn't you recently say you were 'up to your neck' in G ? If that is genuinely true then, even if it was a low-risk stock, no responsible friend or acquaintance should suggest that you commit even more. Most would probably recommend that you diversify or hedge away from oil and the KRI, as Ocelot has suggested.
GKP would hardly be achieving those objectives but it does have merits if you are determined to stay in oil related and in the KRI. My problem with GKP at the moment would be that it looks like it could be near the top - they've also being doing buy backs and more are apparently in the pipeline for the future. Timing is also an issue - OP has a habit of dropping back through winter months. GKP could be a steadier long term bet than G because it's a much simpler proposition based on one big resource - fewer uncertainties.
Of other oil-related stocks at the moment I have done nicely with PFC over the last couple of years but have needed to trade it because of volatility due primarily to an SFO case. However, it is near its lows at present and I reckon there's an upside potential of around 50% long term or just 10-20% over the next six months I regard it as much lower risk than G at its current price. It goes ex-div (interim) shortly and has just released 1H results which have boosted the price.

The market might boom, Ocelot, but OP may not. There's so much of the stuff available to hit the market if the price rises - especially now that hard-pressed US producers have a functioning export route. $60 for many of them represents salvation.
I think we'll be lucky to see over $63 -(LCO or OANDA ) - that's the kind of level that would signal a break from the current downward trend towards $53. December could be a tough month again this year, I fear. ATB

Correct Hawkey.
Shares are a useful incentive mechanism.
G stated that it intended to hold any acquired share in treasury - as a value acretive asset, rather than cancelling them.

Buybacks presumably continued today with around £3.8m probably still left in the kitty - over 45%. It’s disappointing to note that the second phase of buybacks appears to be having much less effect than the first on the strength of the sp v Brent - the 3x ratio rarely strays above 3.05. I guess the continuing weakness of OP and the market in general is flushing out increasing numbers of sellers who anticipate seasonal downside as oil approaches its supposed annual peak looking decidedly weak. The old line about ‘sell in May etc etc’ would have served Genelians very well this year and, indeed, it looks like some did just that on the 1st of that month. The sp certainly does not appear destined to revisit 230p anytime soon unless something extraordinary happens. It should not have been the case of course: OP certainly peaked prematurely, dropping back just as driving season should have been lifting it up. The KSA either miscalculated when they pumped a record amount last November or, perhaps, intended to squeeze the more exposed shale drillers. But with pipeline capacity increasing and fewer export bottlenecks, the hardier surviving shale producers are finally seeing some genuine free cash flows. Increasing US exports have progressively caused the gap between WTI and Brent to narrow and the short-medium term outlook for OP is increasingly gloomy: https://www.nasdaq.com/article/us-oil-exports-become-victim-of-their-own-success-cm1200533

Here are the last five UK trading days G/GKP/DNO v Brent(LCO): https://invst.ly/by8ui
G v 3xBrent (LCO) since late March: https://invst.ly/by8v5

A lacklustre day as G clings to 3x OP thanks to rounding rather than buybacks, so
a fat chance of seeing 192p at $60/bbl it seems. Meanwhile PMO seems to be defying gravity - rising steadily as all else, including OP, more or less flatlines.
G/GKP/DNO/RDS/PMO since April 2019 Peak Oil: https://invst.ly/by8xi

G/GKP/DNO/RDS/PMO since October 2018 Peak Oil: https://invst.ly/by8yh

Can someone tell me what this is achieving?

Between 13 and 15p - about 8% on 165p , the pre buyback sp relative to OP of $60 bbl.
Since buybacks started, Brent is down 6% and majors like BP and Shell are down roughly 10% over the period but G is up 2%.

That's pretttty compellinggg.

Interesting thought Hasiba. Other than the comparison charts with G, I do not follow GKP or PMO in any detail. PMO has always looked like a dog to me, but it has served a few lucky people, who got in in late December, well.
Between G and GKP it looks like swings and roundabouts to me and there have been some good switching-over opportunities. GKP has a simpler business model all built around Shaikan - so very stable and long term provided there are no downgrades there. I don't know if GKP's present phase of buybacks has finished but there were more in the pipeline weren't there? Their buybacks have pushed GKP's sp ratio to OP up from about 3.4x to 4x so, in theory, if OP increases then GKP could do better than G. Here's how GKP's buybacks have pushed that ratio up: https://invst.ly/bxt2k

We've been waiting for a market revaluation of G for a long time and it hasn't happened, which can encourage an 'it must be just round the corner' mentality. It has plainly driven a few people on this BB nuts. But G is a heck of a long way from getting to 4x OP. I think that if I held any GKP currently (I don't) then I'd be seeing how OP turns before making any rash decisions.
Anyway, here's the entire bunch compared from the start of G's buybacks - which may well have some distance to go:
https://invst.ly/bxsyv

Thanks to Withoutt for posting the EIA draw. There was a small reaction in Brent (Currently, OANDA will be about 50 cents higher than LCO shown here) which hit the downward trend, reminding us which direction OP has been going since the end of April: https://invst.ly/bxsmv

Here are the last five UK trading days G/GKP/DNO v Brent(LCO): https://invst.ly/bxsl3

Today’s RNS confirmed some buybacks yesterday - a fairly high daily spend, leaving maybe £4m in the kitty according to my fag-packet notes. Market malaise and weak OP are not helping one jot. There’s simply too much oil in the market.

G v 3xBrent (LCO) since late March: https://invst.ly/bxsnv

This is a key indicator for G in my opinion.Until that orange downward trend, which plots G’s ceiling, gets punched through (assuming it will at some point) there’ll be little to get excited about here.

G/GKP/DNO/RDS/PMO since October 2018 Peak Oil: https://invst.ly/bxsm2

Rangor: Is the market expecting zero growth for the next 4 years?
I believe this to be the case - G is only valued on what it delivers. Given its track record the market is not inclined to make assumptions. I also agree with Hasiba's points.
Don't let's forget, G is a stock currently worth less than 20p in the £1 to original investors. It's not a market star.

Correction regarding GKP buyback effect, should read:
However, it’s worth noting that GKP’s buyback process has pushed the sp up to an OP ratio of nearly 4.04 - up from around 3.6.

Here are the last five UK trading days G/GKP/DNO v Brent: https://invst.ly/bxbbr

You’ll notice that Brent’s two green lines (light=LCO, dark= XBR (& OANDA) have diverged, as they often do on the last Sunday of the month, as the front month contract rolls over for LCO) It matters little - about 50 cents per bbl., with GNL seeming to track LCO more closely. The G:OP ratio was pretty much the same as at Friday’s close, ie 3.1. GKP dropped more than the other two on Friday and, obviously, DNO was traded yesterday in Oslo whilst the UK stocks were not. However, it’s worth noting that GKP’s buyback process has pushed the sp up to an OP ratio of nearly 4.85 - up from around 4.44

It’s worth comparing G to GKP over the entire period since G’s buybacks started:
https://invst.ly/bxbhg where you’ll see G and GKP about neck and neck over the period although OP has fallen by about 8%.

G v 3xBrent (LCO): https://invst.ly/bxbcv

Cheers H.
It tends to stop me losing money, can't say I've made a fortune, although my position regarding G is a lot healthier than when I first blundered into buying it about six years ago, utterly clueless. It was to prove a fast way to flush money away in 2015-16. Hoping it will redeem itself over the next couple of years GLA

'What I didn’t understand is the comments of ‘missed opportunity’ when buying back at 182 vs 172, where the price had been previously. It really makes no difference.'.....

It was really an observation about the process Elcapitan - from a value acretive perspective G should be buying at the best possible prices. 10p may not be huge bucks in the grand scheme but it does imply that no one was actually performing any price monitoring on the days in question - which was really the point. Mind you, 6% would be significant to me if I was spending £250k, it's more than a lot of dividends.