Member Info for chilting

Ocado has certainly been on a steep learning curve since February 2019 and the business has been severely stress tested.

It will be interesting to see what conclusions that they come to as a result of the pandemic - I guess the obvious one is that the warehouses simply are not big enough.

The AGM will more than likely be postponed - most other companies have - will probably get an RNS soon.

I think that Enquest will come through in one way or another - AB is very tenacious - some assets may need to be sold or we could even see a takeover but a brutal cut in revenue for an extended period will do a lot of damage.

I simply don't see demand matching supply for an extended period even with the US shale industry going into meltdown.

The trouble is - and to state the obvious - oil companies only have one source of revenue - they have to continue production in some way or they go bust, especially when they have high debts - so until we reach the point where they are "thinned out" - and in some cases they won't be "thinned out" because Governments will support them - then we are going to still have overproduction and low crude prices.

As the week has gone on my pessimism has increased regarding a recovery in oil prices.

I started the week thinking that a reversal in policy by OPEC+ could save the day but it is becoming increasingly clear now that even with a complete about turn by KSA and Russia would have little impact on the oil price - although it could stop it falling further.

The simple fact is that when the world crude supply capacity is reached crude production around the world will have to reduce anyway to match demand and that demand has been severely impacted by the coronavirus.

With the US now just starting to feel the full effects of virus things are only going to get worst especially as their leaders don't seem to be handling the situation very well - although in a totally callous way Trump's actions will cost many more lives but restrict the financial pain.

The stimulus for recovery will come from China but only when they have a market place again for their manufactured goods - it will be a long wait. Also China are filling their supply capacity with cheep Saudi and Russian oil cutting out other oil producers.

In conclusion, I think crude prices will remain at these levels with little improvement for an extended period throughout the rest of 2020 and maybe well into 2021-22.

Equity Investments are being sold by some oil producing nations in the Middle East and Africa to cover the reduction in oil revenues but Norway is OK.

https://uk.reuters.com/article/uk-health-coronavirus-swf-analysis/oil-rich-wealth-funds-seen-shedding-upto-225-billion-in-stocks-idUKKBN21G05I?il=0

This is a complete character assassination of Trump by the Guardian - not my usual reading matter - but its hard to argue with the journalists observations.

I think the eventual outcome of this could be a real change in the world order - ironically the country where the virus started has the most to gain.

https://www.theguardian.com/commentisfree/2020/mar/27/trump-narcissism-american-blood-coronavirus

The trouble is that its impossible to actually believe a word he says.

It seems to me that OPEC + is very much alive and well and will continue to pile the pain on for as long as they think it takes.

The coronavirus and the resulting economic pain make their task considerably easier and with a smaller market its all the more important - from their point of view - that they knock out as many players as possible and crush exploration and development.

With most of Kraken's production heading for use as bunker fuel, I was wondering if this may reduce the financial impact on Enquest of low oil prices?

Would anyone like to comment.

https://shipandbunker.com/prices/av/global/av-g20-global-20-ports-average

That looks to be the best option in the circumstances.

I have a mid week pass so it will be interesting to see how long I have to wait - I will update if and when.

Squif
The offload was longer than usual - 37 hours - and the draught of IK was 14.3m.

It doesn't work trying to estimate how much crude is aboard the shuttle tankers because we never know how much ballast they have on board but the extended time indicates it was a good load.

Also the transfer tanker - British Reason - is larger than usual - so we could have a 550k load or even more?

Well done to all Health Workers!!!

Loading finished at about 10.00GMT this morning - a total of about 37 hours - the result is a larger than average load heading on IK - draught 14.3m - to Scapa Flo and a hook-up with the tanker British Reason.

Without the weather interruption loading would have finished on Monday 23rd March.

Its looking increasingly likely that the US is going to be hit far harder by the corvid virus than Europe and Asia - although the situation looks grave in India.

Although New York State may have turned the corner - thanks to strong leadership from their Governor - the rest of the country seems to be sleepwalking into disaster - this could be Trump's legacy.

The fall out for the oil industry will be an even more drastic reduction in demand - we just have to hope that producers cut supply to match demand very soon.

This two hook-up transfer has now lasted for a total of 34 hours - 19.5 hours on Monday and 14.5 hours since yesterday evening.

They may well take everyone off the rig and put them in self isolation ashore then send in a specialist team to do a deep clean before sending a replacement crew - that could take 3 or 4 days?

Just hooking up again now - hook up timed at 17.00 GMT - will probably take around 6 hours to fill up with the rest of the load.

Lots of other companies have also issued the same RNS.

IK is on her way in for a hook-up to complete loading - the weather has finally improved - she will probably need another 6 hours or so to complete the load.

Challenging times ahead but at least it looks like the oil market players may be starting to sort themselves out and face reality by doing what they need to do.

Our friend in the green boxes may be the only shorter in Christendom who is destined to come unstuck in the most savage bear market for decades - quite an achievement that - very well deserved.

Its when the shorts start to go long - and they will - that things will start to get interesting.

Massive bargain at the moment is AHT - if only I had some cash!