Member Info for epiphany121

It's not quite spot price. It's the front month futures we're talking about, whch right now is May 2022 (expires at the end of this month). The closest to a spot price is Dated Brent and I'd wager that must be another 3 to 4 bucks above May futures price.

We don't really need these kind of violent price spikes, but the market is currently pricing in an eventual embargo on Russian oil by the US and EU.

There's no placating/pacifying the madman. I'm glad that the EU finally came to its senses and along with the UK, has imposed these pretty tough sanctions on Russia. It's about time too. Wheter he retaliates with Oil/Gas as a weapon is to be seen, but you wouldn't think he's that stupid. You never know though. And now the idiots in Kremlin claim that Liz Truss' comments were the trigger for his moronic threats?? Good for you, Liz.

Being an apologist never ever helped - did the Guardian writer never learn a lesson from what happened prior to WW2?

Good day for Brent and that risk premium is still solidly enbedded in brent, even as some of the Iran JCPOA agreement news is being priced in. Bodes well for oil investors in the coming months.

It's not locked out - it that production was really locked out then oil would be up 30 or 40 bucks, not 5. There are oil transactions carveouts in the Russian SWIFT transaction bar. The worry is more about how mant banks would really take the risk and give a guarantee on the buyer side of the trade, when the sanctions could indeed be ratcheted up to include oil - that unknown risk is what's driving this risk premium. There's probably 10 to 15 bucks Russian risk oil premium now and this is before Spring demand starts to ramp up.

Oil up 6 bucks and Ruble indicated down 30% ... there you have the opening gambit

Russian banks out of Swift, BP cutting Rosneft stake, Crazy man threatening nuclear war - political risk is back on high after the large set of sanctions that went on Russia overnight. You'd have to expect Brent and Gas prices to jump tonight/tomorrow - possibly tempered by Iran's return to JCPOA. Finally, EU has come to its senses with their Russia dealings - there's no pacifying that dictator. Reducing their dependence on Russia's gas and relying on US LNG looks like the way Germany is going to go.

"Consensus seems to be that tech stocks are back in favour because Ukraine situation will subdue inflation and reduce the need for interest rates to increase - all good for tech shares. Also tech shares are oversold and offer good value.

Please don't shoot the messenger but this could be a reason why oil stocks are down today - I was full expecting a big rise here today"

Nah - Chilting. US oil stocks are doing well today and tech is barely treading water - they were up big yesterday though and vice-versa. Rate rises will keep happening - Fed Gov Bullard has stated earlier today that the Ukraine impact will be minimal - read that as a 150bps increase this year. As I've said before, you'll always get tradeable bounces in tech, but to me, they're uninvestable in 2022. The more that oil moves up from here, the lower they go and that's set in stone.

Cushing is hitting critical low levels and that's a concern heading into spring. Any fall in oil or oil shares is likely temporary. I can't comment on why Enquest fell today as I'm none the wiser, but we can only hope it's a blip.

Sell Tech, buy oil/consumer discretionary - that's still the right trade

Lol..KO turned out to be right on this trade and it's funny to see Ammu squirm like that. What an interesting couple of days though and I still have no idea why Enquest fell 7% today.

There's another important consideration for us. We know that hedges are settled on a financial basis, i.e. based on brent Futures price and not Spot price. Because the physical market is very tight currently, spot prices (dated brent) is running a few bucks ahead of brent futures. That extra 'premium' accrues to Enquest, not to the hedge seller. If the spot stays say 5 bucks ahead of futures brent on average this year, that $40 mill is straight to our P&L and Balance sheet.

KO - "This is a complete copy of Tuesday = Pump dump !
Whenever oil moves up quickly the shorts always get hold it and tug it back down, Russian sanctions will take time to filter through and I doubt if the US will stop Russia supplying oil, they would rather lower oil prices than world safety. Putin is in complete control , I bet the Iran deal will also go in there favour causing a even larger risk to us.
Ammu - The SP is falling fast"

You picked the wrong day to sell, KO. I wish you well though. If history has taught us anything, oil overperforms when an oil exporting country is firmly in the picture - like Russia is now. I didn't expect a war to break out, but once it did, there was really only one way oil could go. Simple enough analysis.

Hitman - NBP is up 30% today and waiting for next European/US sanctions moves, no doubt. Right now the situation has echoes of 1974 - and we know the stagflationary environment that persisted for a few years. That's the worry now.

Sad, sad, sad. What an utter tragedy - and a completely avoidable one at. This is all at the alter of one man's ego and his visions of grandeur from times past.

Poor KO never gets his trades right. Whoever asked you to go short at 21 hoping to close out at 17 when the Russia situation was this dicey? I hope you don't take a big loss!!!

I hoped this wouldn't happen - I didn't think Putin would be this reckless. Not good for the global eonomy if this results in a violent il spike and that ultimately depends on the sanctions put on the Russian O&G sector

1000% with you Therapist. Frustrations are getting better of some of us on here - never a good thing.

Gurun - what you say makes sense and is where my thinking at. I feel like a broekn record in saying this - but as my good mate Chilting had opined previously, it's down to the bad production update we had in November 2021. This is ditto to what's happening with HBR. And this is why inline production confirmation next month is key.

Someone brought up Africa Oil on a post earlier today. After the Swedish market closed this evening, that share shot up in Canada/US - it's up 20% today to 6 year highs. I'm sure news has leaked of their dividend announcement next week - Pelle, you happy?. it'll be good if we telegraph such intentions to the market.

I know Squid baby is frustrated, but I don't know what the point is to keep going about AB and how shi*te he's been. We all need to own up and pin the blame solely on ourselves if we've made such investment decisions. KO said to overlay the chart of brent vs us over the last year - I get all that. I still go back to that November update to explain that. I guess that a big part of the reason I'm not that frustrated about Enquest's performance is because I diversified a couple of years ago. I'm sure someone like KO or Squidy have a lot of money tied up in Enquest and us poor lot get to hear all the sh**te that gets thrown our way - nowadays on a near daily basis. I get their frustration, but I don't get how their venting helps them. I'd rather they sell part of their holding and go and invest in US/Canadian oil shares - that'll keep their idle minds occupies, me thinks.

I don't disagree with what Squid says about Equity destruction - but that isn't just an Enquest story. US/Canadian have also seen plenty of that, but they've come back better. I'm of the firm belief that this underperformance won't last for too long.

GLA...

Chilting has been saying this for ages and whilst I don't dispute that demand will be impacted at $125/bbl, inflation adjusted price from say 2011 will still be around 100 or so. The world economies can take this hit and not slip into a recession, IMO. There's a couple of years life left in this oil bull run. S&P is showing weakness because it's a bit tech heavy and is now in correction territory (10% off from peak). We can't say that of FTSE 100, as that's commodity heavy. For now, that's not a bad place to be.

I wish I had a crystal ball for Enquest's breakout day. I'd like to think that the date is when the Annual results are announced - with a solid production update (steady is good enough), Enquest can break out. Let's just hope they can deliver next month.

GLA..

JP Morgan is calling a $110 average brent in Q2.

https://twitter.com/TradeFloorAudio/status/1496516786547798026

BTW - Stop bickering. The only cure to low share prices in the UK oil is higher oil prices. Squid and krackpotters may just calm down then. They still don't get that this Oil SP lagging isn't just an Enquest story - It's a European O&G story.

In my view, Putin for now will hold off on further actions on Ukraine. He'll want to take stock of what the eventual sanctions would look like and let things settle down before making any further moves. Unless Ukraine decides to go in Luhansk/Donetsk, there should be no large scale war that requires large sanctions on Russia, which in turn boosts Brent say another 15 to 20 bucks from here. Nord Stream is on hold and that's a good first step from Germany - they're not going all in to pacify Russia because of Gas. LNG from the US yet help the EU to a good degree as they look to diversify their energy supplies away from Russia. This is what the market currently sees.

The rest of what you wrote are your conjectures and they may be as good as anyone else's. I can't make my investment decisions based on what the Golden visa holders in the UK may or may not do OR based on where Putin eventually wants to get to. Needless to say, oil stocks are a great inflation hedge.

Natwest - are they even relevant? It's partly because of id**ts like these that oil has got to where it has now. It looks like the Ukraine conflict will blow over and oil won't jump into hyperinflationary territory right now. Brent futures got close enough to 100, but come Spring it's all but certain to hit those levels. Enquest just needs to execute and the oil prices will take care of the finances and the SP as a result.

Hi Jan - Lol.. :-). "We have lower production and we are always conservative. We just need to get the market to reward us too !". The market will get there - certainly later than when KO expects us to break out, which was like yesterday. 2022 FCF/mkt cap yield of close to 100% will be noted, as long as you look beyond today/tomorrow - just wait out for that near elusive breakout.