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It's clear that Covid isn't over, as much as the pandemic is.
Financials are all over the place. Nations and corporations trying to claw back as much lost cash as they can, after 2 rough years. Then you add Russia to the mix. The two are IMO related as much as it sound a bit conspiracy theorist. Ukraine is a nice convenient reason to shun Russian energy, and the West to go elsewhere. If we actually cared about Ukraine, then we'd have sent them more than 10% of the promised arsenal. Its all smoke and mirrors to dress up the clawback of lost incomes and taxes.
Russia were mounting an attack on Ukraine long before this year. We saw energy prices starting to rise a year ago, hence we all got a little handout last Winter, and all the rhetoric says that they know fine well that things will still be tough in Q4/Q1 too. The recession is coming, along with a tough Winter for many IMO.
Ultimately though, BP are being hit right now over concerns over consumption, due to inflation, which will in turn lead to lower incomes. I have no medium term concerns though. $120 oil for a while still, the world moving again, 7% buy backs and 4% dividends a year.
Its a no brainer to stick with oil shares whilst the markets yo yo and the world is in turmoil.
Sub 400 is a fire sale. At these prices Ill probably reinvest all the pending divi, rather than taking 70% out for a good knees up.
Aye Spights...... dropping fast. Now a pittance at just $116 :) No idea why, apart from Biden getting a bit tetchy yesterday and telling oilies to stop milking the situation. Supply is still low. Demand is still high.
400p should be pretty much rock bottom prices on this, but who knows. If the markets are selling, they are selling everything because everything is falling. Catch 22.
They just need to decide if its a market tank and get the FTSE down to 6500, or if its not all doom and gloom and we've reached an OK level, which for me is true. Pre pandemic levels, not 10% above them as was the case. Markets got carried away for a while. Its the endless OTT yoyo movements which, as an investor not a trader, are annoying.
Now under 30k for the first time in a long time....
29,911.32
Got to love a nice little correction, as they tend to happen before things well, improve. Its healthy/needed to make profits.
Hopefully we will stay around 400p for when when the divi lands next Friday. $1.21 to £1 = a chunky divi, up about 8% on the last one, despite the amount in $ staying the same.
I have no idea to be honest. down 10% from 2 weeks ago is a joke really.
Nothing new has happened. Oil is down a few %. Global finances are a mess due to rising inflation, which is primarily caused by rising oil prices due to the invasion. What's new? We've known this for months, and have benefitted from it via the oil price rise/record profits in Q1, which may I add, was a quarter whereby oil wasn't that expensive for much of the quarter. Now we sit and wait on Q2; a full quarter of super expensive oil, and Rosneft write downs now behind us. The energy price cap rises again in October, and when it happens people will somehow behave surprised as it ifs not been coming for months/they shouldn't have been prepping for it in Summer, but chose to go to Gran Can for 2 weeks anyway......
The current SP fall; it's just chaff and noise mate. Markets did need a cool off though. over 7000 on the FTSE is stupid considering the state of play. All I know is that oil at $120 means that we are sitting pretty here, with a world which is now running pretty much as it was pre Covid in terms of consumption.
Sounds horrible, but people having less money to spend on things isn't a concern of BPs or indeed the economy's in general. As long as they are spending all their money, that fact that they get get less for it, matters not. They are still handing it over.
Rishi can hit us with another windfall tax in Q3 if he likes. Another 2p on a litre of diesel will offset that easily. And BP was already paying 40% corporation tax in the North Sea anyway. And now we've taken a 40% stake in a £30b Aussie green energy project........ well done lefties, well done. A real win for Britain there. Don't bite the hand that feeds you.
Buying a house is of course, a loan. It's also necessary, which is why you do it. Furthermore, since its the cheapest loan that you'll ever get, well below normal inflation, it's also a great way to invest, and make sure that you have a roof over your head when you're not working anymore.
Generally, people's lives are a mess because they are too ignorant to look beyond next month.
- Stop spending money that you don't have in your bank account.
- Understand that money doesn't magically appear, or disappear. It's effort/choice.
- Live cheap and below your means when you're young and you'll have an easy middle age and beyond/be well off.
- Live expensive when you're young, and you'll constantly be swimming against it/be broke.
But instead in school, lets teach kids algebra and trigonometry.... that will come in handy eh?
Getting there.....
Im not quite as run down as the BP share price is today at least......
My Dad always told me as a kid; never borrow money for anything other than a house or a car, if you need one. Many people live just the other way around though, renting it all because it feels cheaper in the short term and gives you that instant gratification;
Moaning about not being able to afford to get a mortgaged place and so supposedly 'have' to rent, rather than choosing to buy a house in a cheaper/worse area than they can afford to rent in, whilst happily dropping £400 a month on that PCP/aka rented 3 Series or A4, having a sun holiday every year as if its essential, and having kids without financial thought/before you're equipped, etc etc etc.
A mate yesterday asked if know of any houses for rent in my area. His mate has a budget of £1100 a month to get a place worth about £250k. To put that into context; if you drive 20 mins from where I live, you can buy a 2 bed terrace for £75k in a less that posh area, with no Instagram kudos. What's that a month though? £300 to mortgage/pay off super early if you have £1100 to spend? Absolute lunacy/throwing money away on paying 6% a year to rent a place and then wondering why you're broke. Sure, housing is genuinely unaffordable in many areas, but in most of the country, its just not, especially if you're prepared to live cheap for a few years. I got my first house when I was 25. It was on a council estate, but it was mine, whilst all my colleagues were living in a posh area up the road. Then you sell and move up the ladder. But you've first got to be prepared to live on that council estate/put in the less than ideal graft, instead of going for the shiny 3 bed new build early doors. And that's the issue. People want it now, we live in a Klarna world, and don't want to put the effort in BEFORE getting things. They prefer to buy now and pay later, which is a sure fire way of clearing you out before you get anywhere in the long term as ultimately it costs you more.
The powers that be have no interest in putting money management into the GCSE curriculum, as they don't want you to manage your money. They want you to spend it all.
And what about in 20 years, when all those people who've not managed to buy a house retire/have no income other than the state pension which they will moan about being too small after earning an average income all their life. Whos going to pay their rent then? Benefits? The oil companies? Housing companies who've 'profiteered'?
It's plain stupid if you think about it logically.
Demand wont change notably as the world is once again open for business after Covid. Winter is coming in the west too....... As I said weeks ago, the cost of living crisis has barely started as much as people are acting as if its already peaked. Tough times ahead for many people who live on razor's edge budgets/overspend normally.
But the world will always need energy/power. That's why people resent paying for it more than they do for say a bottle of wine which has gone up 20%. Because energy is a need, not a pleasure or fun, a staple, taken for granted, used without consideration or thought. Dare I say it, an entitlement. That's why the energy firms are seen as highway robbers. It's also why the world needs energy firms more than people come close to realising.
The oil isn't going to discover, extract, transport and refine itself, is it?
$$$$$$$$$$$$$
1.25% or even 1.5%? I wonder. What about all those people who took out tracker mortgages and then maxed them out assuming that the base rate would always be zero? Ouch. Sure, properties are double the relative price as they were in 1990, but then in 1990 they had 10% mortgage rates, so your monthly mortgage payment was double what it would be now for the same cheaper house. The truth is that overall house ownership costs are similar. But people only care about the market value and moan about that as an excuse for not buying somewhere. So as base rates rise, house prices will fall. Your monthly mortgage payment however, will stay the same.
And the cost of living/energy crisis; aka nations and corporates clawing back the cash that they lost/handed out for 'free' in 2020/2021 amidst the pandemic. And is it me, or has the attention on Ukraine started to stop a bit? 10% of the promised weapons have landed. Russia are advancing, slowly, but still advancing/winning as much as the media spins it otherwise.. It feels like actually, the West know that Russia will reach their aims of taking some Eastern Ukrainian land and annexing it, and it's merely a case of when not if. It's all about minimising that pain caused by goods shortages and fuel rises, in the meantime until we sort out a world without Russian dependence. Meanwhile, the rouble is stronger than is was pre invasion, after halving in value briefly upon invasion.....
And the moaning about diesel being £1.90 a litre at the pumps is deafening too. What? People really though that Uncle Bernie and Great Uncle Ben would hand you some free cash for your power bills, without taking it back off you somehow at the pump etc? Lefty logic. Such nonsense is why they are never happy. Because the only sustainable way to earn money, is to earn it, not be handed it for 'free'.
The consumer always pays in the end. Nothing is truly free. First lesson in life.
Reinvesting the divi at 400p would be good sense.
Im personally going to reinvest 30% of it (my core holding), and have a well earned blow out with the 70% (intend to sell most it it at 450-475 between now and Summer/Autumn 23).
As I said the other day, time to turn off the lights and come back for results day, which should be stellar once again.
Are they really going to carry on telling us that our company is only worth £80b when have a PE ratio of 6.5+, low debts, 7% annual buy backs, and oil price set to be well over $100 for the foreseeable future?
Cheeky markets.
Got to love it. Check shares for that divi reinstatement in a couple of weeks...... The 390s are not gone yet guys. The DOW needs to cool by another 10%, and the FTSE being in the 7000s is stupid based on all factors.
The question is, once all this global financial noise is over in 12 months, where will BP be sitting in terms of profits, buy backs, market cap, PE ratios and all that.
My guess is still super profitable, raking it in, and all the factors which matter beyond short term market sell offs by the big boys who only care about intraday trading and making that easy 3% a day.
A company whos buying back 7 billion quid a year of its own stock back a year, who makes billions a quarter, and is only valued at £80 billion? Give me a break.
Long term. the truth is all that matters.
I thought that a weak £ was good for the BP share price. 10p+ off again in a steady FTSE.......
Yo Yo time.
Back into the 420s again tomorrow team. Crude down and we are sliding down a ski slope on the DOW. The big hitters love these wild swings based on nothing.
Natural gas just fell off a cliff by 15% too.
Turn off the lights and come back in 7 weeks.....
And lets not forget; inflation is caused by demand for products exceeding supply. Basic supply/demand factors. We just happen to own a company whose product is in massive demand, with lesser supply than normal, yet still plentiful enough to see us making massive profits.
I cant think of a sector other than energy which Id rather invest in should we fall into recession, which is looking increasingly likely.
Get some more money printed Rishi and splash some cash on handouts. That will do it......
I’d agree, but imagine the lefty uproar….
Even though they’ve had their handout granted.
Knowing this chancellor, he’d give then another payday just to buy a few votes as has been his theme for a while now.
Meanwhile BPs green investment funds for the North Sea are channeled into AsiaPac instead…… well done Rishi.
Exactly...... keep those buy backs coming Bernard.
4 billion quid a year.
Time to hike the divi to 6c.
Q2 results in 7 weeks.
Eye watering.
Same again for Q3.”
On the cards today. FTSE futures down 1% and crude also down.
We were due a bad day.
The big boys need to make their money, and that only happens when you buy and then sell up....... and then no doubt buy again.
The DOW needs to cool another 1000 IMO, so the 420s are not done with yet, more than likely.
All healthy movements, and the lower the SP is in a couple of weeks, the more shares we get from that divi.