Member Info for Boyobach

Hydrogen - re Taq Taq etc.

Yes, two downgrades of massive significance plus, of course, at around the same time, a couple of dusters when they were drilling off Malta and somewhere else, all added up to the kind of 'bad luck' tag that sticks with a company. By the time KRG were seriously falling behind with payments, G - a well funded outfit at the start - had gone through a lorra lorra cash with now't to show for it! Consequently the 'jewel in the crown' - the gas - will stay in the ground several years longer than it should have. This sp is going nowhere till there's a move on the gas - which is probably why it took a dive after the August statement and has done a dead sheep impersonation ever since. Without the gas there are no reasons to be cheerful in my very humble and increasingly disgruntled opinion.

I've not much idea what all the CPR jargon really means (though smart enough to know that you can't sell water for $70 a barrel) but there were whispers on another BB about water contact some months before news broke officially. I've often wondered if Taq Taq will rise like a phoenix but, with G's luck, I think it's more of an albatross. The annual report had better be full of good stuff, with solid achievements and solid plans - no gloss in the style of the departed Toni & Guy, sorry, Tony & Nat. ATB

For Tuesday 27th November

From early June onwards: https://invst.ly/9ccsl

From Friday’s close: https://invst.ly/9ccu2

It’s interesting to see the present hypersensitivity to OP exhibited by G and GKP. Today’s first hour provided a good example as early moves of 2% in OP translated to 4% and 3% changes in GKP and G respectively. Noticeable too how GKP and DNO sometimes react more sharply to upward changes in OP, whilst G can be slower and more reactive to negative moves - the net effect being that relative short term ‘gains’ that G makes over its peers are often eroded. The truth is, of course, that normal sp action is still going on but masked by the current overriding theme of OP.

G does need to make gains over its peers, however, because otherwise there is no sign of it closing the gap that opened up between it and the other constituents of this chart during August and September - the period that saw much of G’s momentum ebb away so that it was poorly placed when the OP started to decline. It had even started falling whilst the OP was still climbing.

The net effect has been G’s apparent downward separation from the others - leading to the 15% accumulated differential mentioned yesterday. It seems the only remedy for this is a correction based on results and a re-evaluation. As G is now hugely sensitive to the OP (very different to six months ago) a lot will probably depend on the mood music at the OPEC+ meeting next week and whether or not Trump has some of them by the short and curlies. There seems to be a strong feeling that the KSA, under US pressure, will not follow through with production cuts, leading to even more downward pressure on OP.

Today’s G chart https://invst.ly/9ccrp
looks at the recent places where it has fallen through trend lines (shown in blue and green) which are effectively levels of support. In particular on the 20th and 23rd. In both cases the sp dropped straight to the next supporting trend and bounced back up only to fail (as is usually the case) to immediately climb back aboard, as lines that support going down invariably resist going back up. However, today saw a second attempt to overcome the resistance at 189 and climb back over the green line into the 190’s, assisted by a modest shove from the OP. Crucially it closed below the line so the chances of progressing above it tomorrow are slim. Someone recently mentioned 166? If it reaches there then things will be sticky indeed. As we’ve seen a 5p drop in OP can result in a 10p drop in G at the moment - plus the effect of gravity as it goes below 174 - so, of course, we don’t want to see oil in the mid 50s.

Thanks for assisting Bunks, Hydrogen.
I'm not personally interested in using those sites and, although I've held G on and off since it was a tenner, I'm only interested in comparisons with Brent etc from the end of May 2018 onwards as the proportionate tracking is really only relevant now that G is regularly producing and being paid for significant quantities of oil. From October 2015 to this summer G (like GKP pre restructure) was a basket case - as the sp indicates. So the only charts that really interest me are from May this year. ATB

Hey Hydrogen - Tq Tq, lower OP and the consequential lack of Gas development are the reasons G isn't £10+ today. I obviously had similar thoughts to your inference about Tq Tq, but it's not a subject for discussion here.

Did you not see my post about G being 7 Years Old this month?

Classic quote from the time (link below it):

Genel owns stakes in valuable oil fields in Kurdistan, currently producing 42,000 barrels per day for the Turkish market. The new management, led by former BP boss Mr Hayward as chief executive, is planning to double output. "We want to be producing 110,000 barrels per day by 2012 and by 2015 the expectation is 150,000 barrels," Mr Metherell said.

https://tinyurl.com/ybl29f9o

Hi Lemming

Your analogy does not work....

ISIS affected G only indirectly in that the KRG , already in disputes with Baghdad, under Maliki, that denied their share of the Federal Budget, were strapped for cash to pay their people and security forces. They also had many refugees to shelter and protect. So Oil Cos like G did not get paid. Also OP fell from $100+ to $30.

Taq Taq, G's main producing asset, was downgraded massively. KRG disputes with Baghdad continued under Abadi. Debts to G and others piled up....yada yada yada
ISIS was certainly an additional problem and distraction. But they are gone and, since the over-ride payments have been agreed to cover the receivables that were accumulated and production has ramped up, for G the biggest ongoing set back has been the huge Taq Taq resource downgrade.
The benefit of tracking Brent against the sp is so that we can see when it is being driven by other factors - like it was through late August and September. OP will always have an influence on G's sp - it is what they produce, after all!

I would if I could, bunks. Unfortunately the charting service I use at Investing.com only carries Brent data back to June 7th - it's a bit of a stretch to provide the one I posted.

However, I've bodged together this one from 1/11/17 for you - Brent is just a crude set of three straight lines giving a very rough price path - it was made easier cos today Brent is back to about the same price as last November 1st.
https://invst.ly/9bziv

For Monday 26th November

From today I’m providing a comparison chart which should be more usefully based for G holders than previous versions. It is zeroed on June 1st, when G was very near its peak of approximately 290p. It covers the critical period of interest from then to today (daily ticks).
https://invst.ly/9bxzn

Hopefully this gives a fuller picture because it shows how G performed during the summer months, immediately after it peaked in May, as it retreated to around 240 apparently failing to benefit from the OP peak. From this it’s plain to see that of the roughly 35% G has fallen from 290, around 20% (approx 60p) could be attributed to the more recent fall in Brent and 15% (approx 45p) is presumably for other reasons, mostly experienced before oil peaked.

G has consequently performed much worse since June 1 than either GKP (currently down only 6% over the same period albeit after a prolonged spell at up to +55%) or DNO (down around 17%). Had G matched DNO, then 17% down would equate to 240p today.

For completeness here’s the chart zeroed on Peak Oil $86 (hourly ticks). I’ll stop posting this one in future as the new chart tells the full story rather better.
https://invst.ly/9bxzt

And here’s this week’s chart zeroed from Friday’s close (15 minute ticks):
https://invst.ly/9bx-3

Hopefully the bigger picture from June will help put the current week’s chart in better context without the need for much explanation..

Any hopes of an interest in G by DNO are out the window now......

If they are only offering a 20% premium on Friday's price (bearing in mind the current OP) then I guess it's not much of an offer? That's like 208p for G based on Friday's close,

correction:
'whilst Brent rose from about $72 to $86 in August'
should be:
'whilst Brent rose from about $72 in August to $86 in October'

Sorry about that!

SnapDog: So where do you think we’re heading?

Firstly I must come clean and say that before Friday’s debacle (induced by the continuing dramatic fall in OP) I had submitted a Friday Club entry for next week at 194 (Cystic Meg post - probably no one remembers Mystic Meg, who never got a prophecy right). In that tradition, and given what happened on Friday, 194 is unlikely to happen because it is all driven by OP now rather than the merits of G. If OP stabilises then I'd expect G to recover fairly sharply.

Friday’s price drop for G was obviously driven by OP without much regard for other fundamentals and, in percentage terms over the week, G moved pretty much in a 1:1 ratio with Brent. In fact, as I’ve already shown, G has overall dropped 1:1 with Brent since the latter was at $86. https://invst.ly/9bat8

However, it’s interesting to note that whilst Brent rose from about $72 to $86 in August, G fell to around 250 and sometimes as low as 216 - ie the correlation with OP was certainly not 1:1 during that period. By that yardstick it could be argued that G was at least 15-20% below where it should have been relative to Brent when the latter hit its peak. Why that is the case I don’t know but I recall there was a lot of chat about it at the time. So, by that reckoning, if G had tracked Brent as closely during its rise to $86 as well as it did after, then G should be at 210 or more today. A similar argument could also be applied for GKP (which has lost significantly more) and DNO but, as it would not apply to RDS, we are potentially looking at regional factors having driven G below 200p.

Whilst my own charts suggest that 170 (just below Friday’s close) should mark a reasonable support level, I think the price could well move lower because of the way sentiment and OP are behaving currently. But, we should also remember that G’s sp was 157p when the OP was around $55 pre KRI referendum in September 2017 despite G being in net debt and with production at lower levels. So, there are strong logical reasons for arguing, now as before the drop in OP, that G is significantly underpriced.

As a holder, I’m motivated by such arguments but as an occasional trader I’m not so impressed. I should have sold (some - not all) prior to Friday but circumstances prevented that. I avoid stop-losses which can (and have) cost me, especially with volatile shares like G. At 174 I won’t sell - it’s too near the bottom in my estimation But, equally, I would not buy - as a lower price is certainly possible depending on OP. OP (and sentiment attached to it) is key currently - and no one can predict where that is going with certainty

Posted this earlier but it obv failed....

It’s hard to overstate what a disastrous week G has had - Friday contributing the major damage.

The outlook was likely to be gloomy once the dreaded red line of the wedge was crossed:
https://invst.ly/9bawn

Friday saw another key level broken (green):
https://invst.ly/9baxy

Each would have been a ‘sell’ signal, irrespective of the obvious weakness in OP.

Has it found support at Friday’s close? Doubtful.

The week’s comparison with G hardest hit:

https://invst.ly/9batn

And since peak oil at $86:

https://invst.ly/9bat8

Now the rot has set in the prudent will expect worse.

If at the end of the day leaving the EU is railroaded by elected MPs....

It can't be John. The referendum vote was to leave - the UK will do that unless there's a further referendum. The terms, however, were not voted upon and, unfortunately, the entirely predictable terms demanded by the EU (who were obviously going to have the upper hand) were never spelled out by the government of the day or by the leave campaigners (who were never personally accountable for delivering upon their unrealistic vision). Today's mess is actually the 'fault' of John Major, who signed the Maastricht Treaty without referring it to the British people. Had he done so we could have had a rational and informed choice about something that has eventually became a monster, very damaging to UK sovereignty and almost impossible to escape from.

When, on Monday, I posted about G’s prospects to the year end, I had three tracks to choose from (on charts they’ve been red, green and blue). I chose the most optimistic (red) little realising that the OP was to dive further and the die had already been cast. As I said then, a useful thing about charts is that they can decisively indicate a change of direction. A prime example of that followed on Tuesday, when G cut through both the red and blue lower limits, leaving just green intact. On Wednesday the price popped back up, to ‘kiss the line goodbye’ as some folks say, and, having confirmed its farewell, should have plunged back down. But it didn’t and has lingered about - raising the question of whether it might climb back onto blue.
I rather doubt that it will but I’m going to hold off any further comments until I see exactly what happens next, although the following chart shows what I’m assuming.
https://invst.ly/9arey

I’m not around tomorrow, so if I’m allowed to enter next week’s Friday Club early then please put me down for 194

For Thursday 22nd November

Well the ducks are lined up nicely today: Brent, DNO, GKP, GNL.
https://invst.ly/9arc4
Pity G is lowest - but it’s all relative and, to be fair, GKP has fared the worst since Brent was at $86.
https://invst.ly/9arc8
Not much more to say as Brent seems to have stopped falling for the moment - is this the bottom? Probably not.

Comments specific to G in a separate post. Also not much else from me over the weekend, although I’ll try to send Friday’s chart.

I heard Trump in a news interview thanking the Saudis for their help in reducing the cost of oil, adding that he'd like to see it even lower. I'm sure the Saudis and his buddies in the shale industry must be delighted. My recollection is that the break even for US shale producers is generally around $50, although for some it may be as low as $30. WTI is currently around $54 . Does he really want to tighten their margins even more and how much did the Saudi's willingly participate in the recent OP 'adjustment' that he appears to have instigated? I guess we'll find out when the next OPEC meeting gets underway on Dec 6th. This article gives some insight about what influences are bearing upon the OP: https://tinyurl.com/y9pa7qnn

I heard Trump in a news interview thanking the Saudis for their help in reducing the cost of oil, adding that he'd like to see it even lower. I'm sure the Saudis and his buddies in the shale industry must be delighted. My recollection is that the break even for US shale producers is generally around $50, although for some it may be as low as $30. WTI is currently around $54 . Does he really want to tighten their margins even more and how much did the Saudi's willingly participate in the recent OP 'adjustment' that he appears to have instigated? I guess we'll find out when the next OPEC meeting gets underway on Dec 6th. This article gives some insight about what influences are bearing upon the OP: https://tinyurl.com/y9pa7qnn

Hi Hawkey

Don't get too excited about it. In this view of the last few days https://invst.ly/9afv- you'll see that up to and including the 19th the closing prices were above the red, blue and green lines. Crossing any of those was not good- the red was previously identified by Bottmzup and had already been moved to the most 'lenient' position possible- anyway, as of yesterday, that is no longer relevant.
The blue and green represent two trends that G has followed in recent months- one up (blue) and one down (green). Obviously it has followed green rather more. Dropping below the blue meant the price was giving up on that direction (again) and sticking with green. Whilst green isn't good, dropping below it would indicate that things are getting even worse. G has been following green at one level or another since the sp peaked in May: you can see green and blue here: https://invst.ly/9ag9f and the way the sp has moved along or between them over time like a tram on a track.

I don't really expect G to move upwards much until there's more clarity about prospects for the OP

For Wednesday 21st November

A somewhat calmer day regarding OP and a chance for some of the overreactions to get corrected. This seems to be the way it often works when the OP slides significantly: industry co’s take a knee-jerk hit and then there’s some rebalancing. Even RDS seems to exhibit this effect - today being a good example. Today also, I’ve added DNO to the comparisons thanks to a comment from bunks earlier. It seems to work, although there’s a glitch in the ‘from peak oil price’ chart where no DNO price changes are shown during late October.

This week’s comparisons: https://invst.ly/9acdu

Since Oil was $86 comparisons: https://invst.ly/9acdq

Finally, the G chart shows how, following today’s action, it may have regained the ‘blue’ support trend that it fell through yesterday, now that would be a reason to be cheerful if it lasts.

G’s track: https://invst.ly/9acd2

Excellent thought bunks, I've added DNO to the comparison - hopefully not making it too overcrowded.
https://invst.ly/9a6nn

G took more of a hit than GKP yesterday.
Both GKP and G experiencing a disproportionate reaction to OP this week. https://invst.ly/9a5-k