Member Info for chilting

Packaging is a hugely expensive outlay for any business that sells pre-packaged product.
I remember one potting compost manufacturer telling me that they had more money tied up in packaging than product in their yard.
The problem is that they have to order in very large quantities for each product in their range and delivery times are always excessive in the best of times, at the moment they are intolerable with product being sent out in plain packaging or not at all.
Pallets don't seem to be a problem at the moment.

DenFos
As I read it, the roll out to opening starts this spring with the actual trading from the site starting in the Autumn.

That's a great comparison Boyoback - it even shows when CWR went overbought in late April and then corrected with the biggest drop on the graph when the market reversed.

mrc
The obvious answer is OPEC+ and that will become more likely if demand falls but I guess if they are left in control of the market then the oil price will fall or rise to a level they are comfortable with, governed by what the market will accept.

There are so many imponderables here that will make a big difference to the oil price in years to come that it reinforces the case shares in oil companies are not a long term hold but simply a contrarian trade when market conditions look right.

mrc
Yes, your scenario is also possible but its not something that we have seen historically very often, especially after shale became established - over supply is much more likely with so many players in completion globally - also separate nations want to maintain their own energy independence..

There could also be big buyers taking advantage of the flat market and giving MM's low priced orders to fill around the 1900 mark.

mrc
Its not about the volume of oil used - high or low.

Its about balancing supply and demand.

The problem is that if demand for a product falls the lag between supply adjusting to accommodate the fall in demand is likely to have a negative effect on price - renewables gradually eroding market share.

In other words oil could perpetually be in an over supply situation - just as it has been while US shale production has been unbalancing the market.

The chart watchers have $67.19 as the magic number for a WTI breakout - its currently $67.23 - worth watching!

Kraken
In all the time we have been talking about the US shale industry, have you ever known anyone involved in it to take the sensible option - they have the spirit of 49ers running deep in their veins.

mrc
All the constraints you mention certainly hold very true in 2021 - but will they in 2022?

The Americans are very entrepreneurial - if they smell profit they react very quickly and it doesn't take much to get these rigs up and running.

Any Covid bounce has to be sooner rather later and with renewables gaining market share, it might be the last chance to make money out of oil before supply totally out strips demand.

Maybe its the institutions who are contemplating investment here at some stage who are shorting the share to hold back the SP.
Then when there is good news they release their grip for a few days so that the SP raises to the next level and then repeat.

Tarmak
Curbs are coming on the oil industry in the long term, but in the short term I think that production will bounce back strongly regardless of the green lobby.
I think that the US Shale Industry certainly has the capacity to bounce back next year.

ArielArrow
Yes, 100% but its not down to Enquest, it applies to the whole sector globally.

e121
If there is going to be a big breakout into the 100's then logically it has to be in 2021.

Because by 2022 the US shale producers and others, would have seen the potential and upped their production capability in the hope of benefiting from a shortfall in supply.

Yes, the rebound in hydrogen stocks looks like it is gathering momentum and with the climate change debate staying centre stage in the run up to COP26 in November, the omens are good.

It looks like 170 could become the new 160 - but lets hope not!

We had 140 - November to March and 160 March to May - so it should be 180.

List was posted by Neil at 23.19 last night.

The problem with that argument Jan is that OPEC+ still have a lot in reserve - they are holding their production back to boost the oil price.

All the while OPEC+ are in control of the market and can manipulate the oil price at around this level then things are rosy.
They get even more rosy if OPEC+ have to boost production up to their full capacity.

BUT, that all comes crashing down as soon as other producers respond and start upping production again - especially the US shale producers - hence we could get a rerun of the 2008 scenario when Brent shot up to $140 before falling back to $40.

In other words take the ride up but get out bloody quick as soon as the Yanks get their act together.

An excellent article written by Michael Fitzsimmons for Seeking Alpha.
He makes a very compelling case against long term investment in the oil and gas sector.

It could be that the short relates to hedging their bond holding - if they increase their bond holding, they increase the short.