Member Info for jmak1912

UpDownFlat

This is due to supply pressure in Brazil from mine closures and rail issues. This is offsetting the demand drop atm.

Pretty indicting reply to be honest, but I cant resist to respond to a few of your retorts.

1. Sure you did, I'm sure you were also saying BP would be at 600p
2. You are literally saying things that are not true China has had a slowdown in construction - please look at steel output and iron ore shipments. Note the impact of Evergrande could further dampen this once it is fully realised on the ground at the sites.
3. you said "Inflation is higher so even more reason to commodities to value higher" so you are arguing inflation causes prices to rise....where actual inflation is due to rising prices.
8. Reputable JP Morgan.....not many saying that in 2008. The variance in broker targets from so called reputable firm is sometimes extremely wide or at odds, how anyone is supposed to decide you is right is beyond me.....which "proper facts" are you going to believe - also there is no facts in future predictions of revenue and expense etc.
10. You used GS your reference to oil price....my point is no one can predict the oil price. Look at what the EIA and IMF were saying earlier this year. https://knoema.com/infographics/yxptpab/crude-oil-price-forecast-2021-2022-and-long-term-to-2050

I admire your confidence but it could lead to hubris

@Stockready1 I think pastyc has raised a valid concern.

Your rebuttal is slightly aggressive and to state "We will hit over 600 this year and as said before certainly above 550 by October (IF NOT SOONER)" is simply not true.

No one can say with any certainty what the SP will be by October.

I am as bullish as the rest but this sort of bluster in response to peoples genuine concerns is not helpful. I'd like also to respond to your points below to be objective....

1. Oil can go up as well as down 2 years ago nobody called negative oil prices, 1 year ago no one was really calling $85 oil.
2. This is an opinion with no argument - you will find some commodities (iron ore) are facing demand destruction due to China slowdown.
3. You have mixed up cause and effect - increased commodities cause inflation....
4. I think this will not really effect demand side as those who will have access (high income nations) are already reporting lower deaths and higher activity
5. New variant could equally be a game changer....if its severity is matched by its transmissibility
6. Not sure of the relevance
7. Agree that there is more demand clarity now.
8. Broker targets are subject to their own interest and bias if they truly believed in it surely they would buy every available share at these prices.
9. Covid has been listed as 3 separate points but really should be one - notwithstanding its remission is a good one.
10. GS have not been a great predictor of the oil price recently again a target is just a best guess.

Overall I agree that BP is undervalued but I think this will become more apparent once the demand fully kicks in. Once it does it is predicted that this, for one of the first times in history, will exceed maximum supply globally. Due to underinvestment this could last for years and therefor oil price could reach extremely high levels. I previously shared a report which I am basing my investment on (for Oil) mixed with BP's overall transition for the long term (for BP).

Now this is what I believe is coming however I'm not blind to the fact that this could be impacted by other global issues such as;

New energy tech.
Major incident involving BP
New government legislation / taxation
Global economic slowdown
Rapid investment bas to O&G not currently forecast
New pandemics
Act of God

The list could go on but my point is basically people need to be more objective rather than just yelling that the price will definitely hit a target when asked if it can. It would be more helpful to explain why you think this and also show why you think it may not - I doubt anyone has bet their house on their certain predictions for the reasons above

http://info.gorozen.com/2021-q3-market-commentary-the-energy-crisis-is-here?hsCtaTracking=cc44492f-1a7e-416e-97cc-3ae9b890445f%7C85bfa7cf-abeb-4462-bb20-33a8c722479b

This was previously shared during the quieter times on this forum, but this is a great piece of analysis that comments holistically on the supply, demand, spending and spare capacity.

Summary is we are reaching a point (est. end of 22) where true max supply will not be sufficient to meet demand and the lack of investment going forward will only exacerbate this..... good for big oil, bad for consumers....

Aye, he should of just slated her, then sacked himself.

It would be rather un-conservative to raise a WT (Thatcher aside) - that said they are in the groove of populism these days so you cannot write it off. Considering they weren't levied in 2008 I cant see the justification here especially after the huge losses.

Looney has already set up and could easily argue the requirement for needing these excess profits for the transition to green energy and use this as an ethical retort rather than saying we greedy shareholders need it.....

What is holding this back? Obscurity?

Licker, I think you need to go on the Q3 call again.

The book loss on gas was just accounting and they will unwind once they deliver the actual gas. It's not a hedge in a traditional sense

Thanks All, it was only appearing in the desktop app and not mobile.

From my understanding in this first tranche we only get to apply for a small fraction (1 for every 23 shares owed) but we can apply for 10 to every 1 share owed in the second tranche.....

Hope that is the case.

Hi All,

I wondering if anyone could assist in how I can apply under the for the Open Offer shares as an existing Shareholder I am having trouble on understanding the process (note my shares are held in IBKR). From my understanding I have until the 29th Dec to apply? I noted some addtional TWD tickers however they are unable to be traded at this time.

Thanks,

Excellent piece of work and only reiterates what a strong position BP are in near term - hopefully the buybacks can fly whilst the SP languishes.

It is also important to note that at the current SP - buybacks are buying the company at a 'discount'.

even if we take a fair value of 420p - for every share BP buyback there are effectively buying these back at a circa 20% discount. Ergo ROI on every pound spent is 20% on BB's.

Obviously this will take time to come to fruition but for me, when SP is depressed you should focus on BB's - unfortunately most companies do the opposite....a year ago BP would have been able to buy nearly 8% of outstanding shares based on a 200p price and their current annualised purchase programme....

I am hoping BP approach one of the large II's who are looking to divest from oil and make an attempt to buy back a large portion of their holdings at a discount to market...not sure if this is possible under the current BB framework?

I tend to ignore the day to day SP swings as usually they cannot be reasoned.

I thought the call was a very strong display especially from the CFO Murray, they made all the right 'muted' noises and we're clear in the strategy of changing to an 'integrated energy company' and reconfirmed the benefit of picking BP over a pureplay green energy company in regards to self financing from existing commodities.

It will be interesting to see how they taper of the additional 40% of barrels. I think the price increase has impacted this tactic as assets which may have been less viable at $60 are now also pumping out the cash. That said this will most definitely increase the selling price of the assets. So all in all not a terrible problem to have.

The only further clarity I would like is a buyback reconciliation to their surplus CF (900m). An analyst asked for more clarity but it wasn't easy to follow. What i understood is that they were well above the 60% figure.....or in reality the surplus CF is close to 2m - hence the circa 800m debt reduction....just seems a little more elastic that a strict 60/40 split.

I think you can be both invested in BP and also wish for a green energy future.

I am not a particular fan of Greta but even though she may not have all the technical knowledge, she is providing the role of awareness - there has been dozens if not hundreds of leading scientists and even industrialists who have highlighted the issue of sticking with our current energy systems over the past decades - this has fallen on mainly deaf ears as they are not marketable. Once you have a figure head, these issues are followed more closely e.g. Gore et al.

Its naïve to not understand this; look at the majority of world leaders and you will see the same, very charismatic and marketable but do not understand the detail or technicalities of the issues of most thing they discuss - nor should it be their real duty.

I find it pretty infuriating when people try to belittle the issue and say it cannot be done or that people cannot prosper from it, there is a huge appetite for investment in the space and companies who are involved in the space are clearly doing well in terms of SP.

I am also not naïve enough to understand the need for a transitory period for energy or that any green company will still not be ultimately driven by profits and will have unsavory elements, but my reasons for BP was they seem to be the most understanding of the urgency and public opinion and have actually backed it up with investment / actions.

TinkerT the buybacks are a great insulator against any drop going forward also....on the condition that money is being made....

This is why it never bothered me when the SP was below 300p and why it wouldn't bother me if it reached that point again.

At current commodity prices they could potentially be buying back nearly $8bn per year based on FCF....or to put it another way 8% of the current MC or 10% based on 300p....

Assume its one of these 3...

Exponent Private Equity LLP 235,681,708 33.8%
Toscafund Asset Management LLP 156,018,724 22.4%
Ravensworth International Ltd. 151,990,000 21.8%

As per H1 20 report they stated :

"..... the Board remains firmly focused on reducing net debt ......it believes that the interests of the shareholders ....are best served by not paying a dividend until the net debt leverage ratio falls below 2.5x at the earliest. This is in line with the senior finance facility agreement"

Well 1.0x was just announced, where's my cake?

@compound

You make some good points regarding the demand destructions, however I think a lot of people have made good contrarian points in regards to where we are heading with oil.

I feel demand will keep rising in the near term however investment and appetite for new supply is waning. I do not see the price of oil simply fizzling out due to lack of demand but rather reaching a point of pricing supernova due to unshakable demand and lack of investment in a dying industry. I'm trying to think of a parallel but I'm struggling - maybe prohibition....or anything outlawed I suppose.

The human race is terrible as a whole at making predictions and targets and i feel the transition to EV/alts will be the same. I'd encourage you to read any 2020 vision document that most governments / companies produced in the last 20 years.

I don't think this is going to be particularly nice or smooth.....the reason I opted for BP was the mitigation of risk by way of green transition...which also happens to be the right thing to do.

@dollarboob - probably in around 3 years' time

@Sigma1

The issue is that nearly one quarter of the S&P 500 is weighted to 5 companies. They alone have caused the drive up to this level (I'd be interested to see how the remaining 495 average out. over the past 12 months).

From this point on I cannot really see how this trend will reverse....they are such cash rich behemoths who can keep driving growth globally....

who would be against them...….can't imagine II's and HF's selling out or PI's falling for a trick. People are in for the long hall on these 5.....