RE: Oil sentiment29 Jan 2021 00:50
I tend to take a more ‘satellite’ view on my analysis,so, without attempting to sound patronising, but apologies if this is interpreted as such. Oil is not just about cars, trucks, vans, jets, but there is an entire world of organic chemistry related to oil. Take, for example, your Nike, ASICS, reebok trainers. That’s the first contact to the ground you fit, young, healthy folks experience. These are all organic compounds derived from crude oil. Then there’s the polyester in your poly-cotton socks. Moving on up, some will have opted for stretchy jeans, not to mention the extreme comfort from having a block and tackle cradled in Lycra. I could go on. But I won’t.
Reality is that oil is here for a good 10+ years, but not in the same way we have enjoyed in the previous 100. Big oil know this and have been unpicking themselves from unprotected positions for about 4-6 years. They can see it coming. They know that oil demand reductions are on the horizon, yet they’re in no rush to completely abandon the model. So, they still haven’t transitioned, but are on their own journey. They still, however, need to shove bopd through their model, whilst adapting to newer renewable/sustainable (for debate) models. Whilst this evolutionary leap occurs, there will be some players in the market (notably agile and innovative producers with NEAR term exploration potential upsides) whom will benefit from big oil pullback as they plug gaps. Particularly those with large underlying asset bases, low cost production and high technical expertise. Truth is, and I’ve pondered this for a few weeks now, if you aren’t in the production phase yet, then you’ll be bloody fortunate to ever get there. UOG is. Not just that, but they are agile, have huge technical ability and will respond rapidly to an evolving market.
I’m inclined to share more, but I feel I’m ramping if I say any more. Make your own choices, after doing your own research.
Caribs
Sign In
Follow the stocks
