Member Info for nicktheglobe

June 2020 WTI is at 25.52 according to:
https://www.cmegroup.com/trading/energy/crude-oil/light-sweet-crude.html

Ignore the fading May 2020 contract: that's virtually physical oil and nobody wants that!

All of these different viewpoints are reflected in the market. Close to spot May 2010 WTI is $22.86. One month further out in June 2020 Brent 2020 is at $31.84. Brent normally trades at a little more than WTI but very rarely this much. Further in the future in Jan 2021 Brent is at $40.09. So there's a massive contango with a glut in the spot market, which will continue into May. By June the glut is becoming more manageable and we're well into a recovery phase in January 2021. Traders will buy at spot, store the oil and hope to make a profit at the end of the year after expenses.

BTFATH1, I suspect you are one of life's losers in investing. You buy when things are going perfectly (at the top) and you sell when things are going dreadfully (at the bottom). Many successful investors do the opposite. There are rumours that WT1 is going to open limit up.

Interest is PIK (Paid In Kind, more bonds) unless Brent averages over $65 for the 6-months preceding a payment. A good strategy by AB! Debt does goes up 7% a year compound, but saves on cash.

all markets open in New York on Monday!

What I thought was the most encouraging feature of ENQs' report was their adopting a lean existence in response to the crisis rather than taking on some desperado new debt. Rather akin to what a family might do: take out a second mortgage to leave things as they are or take a ruthless axe to loss-making activities. They did the latter of course and think this increases the chances of survival enormously. As a holder of the 7% retail bonds I would not expect we bondholders to agree to an opportunistic buy-out of our debt below par without a massive equity offer, which would dilute substantially existing equity holders. In other words the bondholders would takeover the company as with Whiting, the bust shale driller in the US, now owned 98% by the bondholders. Can't see AB wanting this to happen, which is why he's chosen the lean approach.

Crude +11.9, gasoline +9.4, distillates -0.2. Very large build but Brent rallied 50c on news as suspect market thought it might have been even worse. Gasoline is of course directly affected by lockdown. GS would have predicted much worse, but maybe they're talking their book!

That's a good find Pelle. I've found a publication on it in the respected BMJ, not a personal blog:

Covid-19: four fifths of cases are asymptomatic, China figures indicate
BMJ 2020; 369 doi: https://doi.org/10.1136/bmj.m1375 (Published 02 April 2020)
Cite this as: BMJ 2020;369:m1375

https://www.bmj.com/content/369/bmj.m1375

In an article on the website of the Centre for Evidence-Based Medicine, Jefferson and Carl Heneghan, director of the centre and editor of BMJ EBM, write, “There can be little doubt that covid-19 may be far more widely distributed than some may believe. Lockdown is going to bankrupt all of us and our descendants and is unlikely at this point to slow or halt viral circulation as the genie is out of the bottle.

June 2020 Brent opened at $27.95 and is now $26.62, so appreciably above expiring May 2020 contract, but still dire! Contango is colossal due to current glut of physical oil.

Amjad must be doing the calculations involved in taking ENQ private. Current enterprise value is approx SFA $400m, bonds 30% market value of $980m, that's c$300m, shares £128m, that's c$150m. So all in enterprise value is $850m for a business that pumps 60k barrels of oil a day, which in 6-months time could be worth at $50 a barrel $1 billion a year in revenue, with no debt! Just a thought ...

But then the Telegraph has an article on Sweden's approach to the virus, which is similar to that which Trump might adopt. Further Sweden's figures are not off the scale as predicted by some.

https://www.telegraph.co.uk/news/2020/03/27/swedens-resistance-lockdown-raises-questions-tough-approach/

https://uk.finance.yahoo.com/news/rare-step-oil-sands-giant-180056744.html

Suncor is closing part of its 194k bopd oil sands plant in Canada. Very expensive to re-open as bitumen based, needing continuous heat. It's one of those land-locked sites where prices of oil actually received are very low, going negative in one recent case.
Baker-Hughes rig count for Canada was 54, down 44 so very sad times for oil industry in Canada. In USA rig count was 728, down 44.

Investing.com - U.S. oil inventories fell slightly last week, according to a measure by the American Petroleum Institute out Tuesday.
Stockpiles of crude fell by 1.25 million barrels for the week ended March 20, the API said.
They were down about 421,000 the week before, according to API.
U.S. distillate stockpiles fell by 1.9 million barrels, while gasoline dropped by 2.6 million barrels.
WTI futures continued to gain ground after settlement, rising 4.5%.
U.S. Crude Inventories Fell by 1.25M Barrels Last Week - API

Not sure it's been pointed out but all UK oil producers are benefiting from the devaluation of the £ against the $, from 1.30 to 1.15 over last few weeks. ENQ's costs in £ (wages presumably at least) and retail loan in £ are all cheaper in $ terms, reducing the oil price needed in $ terms for break-even. So things are difficult but the devaluation does help a little.

Well the NHS call it a vaccine
https://www.nhs.uk/conditions/vaccinations/flu-influenza-vaccine/

And it meets the defintion:
a substance used to stimulate the production of antibodies and provide immunity against one or several diseases, prepared from the causative agent of a disease, its products, or a synthetic substitute, treated to act as an antigen without inducing the disease.

The fact that flu is a moving target makes life difficult but doesn't stop it being a vaccine!

I seem to remember having a flu jab every year!

https://oilprice.com/Latest-Energy-News/World-News/Surprise-Inventory-Draw-Fails-To-Move-Markets.html

crude -0.4, gas -7.8, dist -3.6 all a surprise. US production down a shade at 13.0

Current low prices are in anticipation of downturn and Saudi dumping, and do not reflect the current situation

Good news on virus continues from South Korea and China. Weekend futures on IG have ftse at 5374 (unchanged on Friday's actual close) and dow at 21900 (lost 1/2 of Friday's late rally but well up on Friday 16:30 at London close).

As I say -- significant!!

But if they are buying 100m in total and the surplus is 3m a day, that's 33 days of surplus gone. I don't see why they shouldn't build some more storage tanks or hire some tankers to store some more, if they're determined to keep the price up for the shale boys.