Member Info for romaron

Hi mrc - I think there is a big underestimation of Putin and Russia. I think we have become soft and the ducks are aligned. This is Putin's moment. I disagree. Russia is a great power.
I think we are puppets of the US. How can we have threats of a windfall tax when you have this in today's Private Eye:
"Number Crunching
56% Increase in people Google will employ in Britain (to 10,000) as result of buying central London office in what Rishi Sunak called 'a big vote of confidence in the UK'
2.7% Amount of Google's £1.8bn revenue it paid in UK corporation tax for 2019/20, thanks to company insisting the real work is done elsewhere."
Let's see how the situation unravels. Russia is building its forces in preparation. You think they'll back down or it'll be a minor incursion (a la Biden). I think it'll be testing and feints followed by an explosive strike - and Ippon. The West will take economic sanctions that will unravel almost immediately as Russia responds. Cessation of Gas flows could bring Europe to its knees in weeks.
A pint if we ever meet to who is closest.

* O/T black swan - Dave Ryding has World Cup win in Kitzbuhel Slalom.

I can't see anything other than an invasion. The key is energy and Russia has lots. It is the biggest country in the world and can survive without Europe better than the other way round. Europe needs their energy and renewables aren't the cavalry. They have faced hardship before and seem to almost enjoy adversity, tough people who take pride in their resistance to foreign threats . The world has moved further right and I'd go as far to say that Putin has a lot of support from the GOP. Trump undermined NATO and we've seen a lot of support throughout the world for 'strong men'. The bogeyman to the US is China anyway. Rory Stewart said that it's not even about NATO but more about the EU. Putin is more scared of democracy and the benefits that EU membership brings.
I imagined a similar situation with a troublesome region in Britain. How would we feel if Scotland joined the EU and the EU made life difficult for England by playing on the divisions created by Brexit. There would be some in England wanting the EU to move south and for us to rejoin the EU. Not in the same league but we've seen how Boris and Farage played on deep seated fears especially immigration. Trump took it even further with the wall.
Putin is aware that the US doesn't like boots on the ground warfare and whilst the US is immensely powerful and could win a conventional war easily Russia is much more prepared to sacrifice its young men than the US is. Those same young men may well believe they're fighting for mother Russia against forces lined up on their borders. Can the US and allies create the same dedication? I don't see that the US has its heart in another war when they've only just left other theatres, plus it is more than 5,000 miles away.
The West is weak and the 'NATO line' makes about as much sense to me, and is as effective as, the Sykes-Picot agreement or the arbitrary partition of India in 1947.
Putin has a natural cunning and firm convictions. I think he will rightly dismiss the wailing and flimsy diplomatic approaches as just so much window dressing and is quite prepared to take the economic hit. There is a lot of world that isn't US or Europe.
I expect a drop in indexes and the world will move on to other things in a few months. EnQuest will be a beneficiary but we may have to wait a few weeks whilst it settles down. People in Europe will be taking holidays whilst people die in the Ukraine. Ukraine has been part of Russia for centuries. It isn't our fight.

I'm leaning towards Lending here but getagrip more or less said the same. I accept that there are no guarantees and I'm extremely dubious of anything beyond 1 year for financial calculations but you have to try because companies have projects that go further out and they take years to bed in and reach scale. At least with interest rates you have bond markets to get some idea and the credit rating agencies approach is also worth having. Many analysts have an accountancy background and are also worth listening to as well. You both come over as intelligent observers so don't fall out as this board is a bit thin on the ground when it comes to valuable input. I'm looking for a little more than could go up, could go down next week. I think you make a financial model for the foreseeable future and then accept that further out wobbles about and it is sometimes easier to pin jelly to a wall.

Good posts Lending and Getafgrip. No doubt Hewlitt Packard used DCF when arriving at a price for Autonomy. I once asked a partner of a Big4 Accountancy firm to explain the difference between DCF and NPV. He actually understood less than me. There are too many variables for it to be the only yardstick and is often as wrong as Mr. Market. I actually agree with both of you and that is confusing because Lending disagrees with getafgrip. Do we have 3 views now?

I quite like the uniqueness of the Darktrace situation. A lot revolves around a potential court case with ML who is only an advisor to the company now. I think it is media hype and anyway the company is quite young but with talented individuals and likely to have better governanace and auditor scrutiny because of aforesaid situation. Then there is the fact that it is has a large UK presence and not everybody wants to work in the US. Try factoring that into a model.

Weird that. All those promoting hydrogen have a lower (eventual) price. Lots of expect, projected and a plethora of "estimates" on even the current price. Bearing in mind they're not even economic when produced from fossil it is a leap of faith to expect renewables to do it. Then there is the tiny production. Sure it'll increase but at what rate? That article suggest a leap from 2 barrels a day to 5,000 a day.
I'm getting in a right old muddle here. Using the limited numbers in the article they say they'll produce 250,000 tonnes of hydrogen on the 5th of never. That's the equivalent of 1,860,000 barrels of oil in volume. It gets better in kwh terms so say 6,045,000. That equates to an oil price of $59.55 if everthing goes according to plan and assuming the $360m is enough. It is a rather fuzzy figure and appears to relate to the Pilot Phase. Operations are targeted for the 2030's and gord knows what prices will be then. They use terms like "The project has the potential to be a game-changer". Well doesn't everything? A cynic might say it keeps the activists quiet whilst carrying on importing 4m barrels of oil a day in Japan. If everything went swimmingly (lets forget cost because they never tell you and anyway its a pilot) this project soothes the activists and is not much more than one days oil imports. That's the trouble with these things. Upon investigation they kinda fall apart.

I've been doing some deep research and need a check on my figures.
It follows on from this missive that landed in my email box:
https://www.reuters.com/business/environment/worlds-first-hydrogen-tanker-ship-test-cargo-australia-japan-2022-01-20/
This particularly caught my attention "Last year, HESC started extracting 70 kg of hydrogen a day from brown coal "
1 kg of Hydrogen = 33.6 kWh - 1kg oil = 10.35 kWh - 1 barrel of oil weigh 136 kilograms. So, by my calculation they are now producing almost 2 barrels of oil a day!
Things are moving fast now and a FID is expected in 2025. Obviously they're expecting exponential growth and it is good news for the 300 householders in Fife on the hydrogen trial. At first I imagine they welcomed the grants of c. £100k per home but I wonder how they'll react when the subsidies are removed and they pay the market price? By then I can see hydrogen prices down to about (say) $1400 a kg from the present $14,000 a kg (70k a day for a year with initial cost $360m). At the current price of production this is equivalent to a barrel of oil moving from $4,300 a barrel to $430.

Perhaps I owe chilting an apology. It looks like nothing can stop the race to abolish fossil fuels. It also solves the care crisis as those in energy poverty freeze to death. A kinda win win.

*I would like to point out I am neither a mathematician or scientist.

Thing about Netflix is that people moan about the BBC and repeats but Netflix is full of them (up to 97%) and much higher in percentage terms. BBC repeats always creep up at Christmas time fuelling the anti-lobby.
I considered buying 23andme when it went public but thought that it is usually a one off purchase. Once you know your roots and find Pelle is a distant cousin it's all over.

*Mind you I recommend After Life series 3 (on Netflix now) and will watch the new Ozark this weekend.

Hi Modestus - I think EnQuest is one of the most defensive stocks out there. I think that the windfall tax is weighing on oil stocks. The energy crisis is filling the news over here. It is a big part of inflation. The weighting for poorer people is much higher as they can pay up to a third of their income on keeping warm. Populist politicians look for scapegoats.

Well I'm bunkered down now. I have enough cash for 21 months without the pressure of needing to sell any stocks. I don't expect this current threat to last more than 3 months whatever happens. So called super-powers still think they can subjugate the less powerful. Vietnam and Afghanistan kicked out the US. Patriotism is a strong motivator and speaking Russian in Western Ukraine brings strong condemnation. Once the body bags start returning to Russia things will change.
I know the jocks irritate me but would I kill them, NO.
Civil wars (which I think this is) are by far the most vicious. I remember a Serbian story where a body had been mutilated and the eyes gouged out. The reported comment has stayed with me: "they say his brother did it" and the response "ah, that explains it".

Hi mrc - I just think he's unpredictable and so is war. No battle plan survives contact with the enemy or as that great military tactician, Mike Tyson, once said "everyone has a plan 'till they get punched in the mouth."
I hope you're right.

Leave it out Z.F.G. onedb is one of the good guys. Anybody who says they understand the market and continually win are just liars.

If triangles had a God, he would have three sides. -Charles de Montesquieu, philosopher and writer (18 Jan 1689-1755)

She emphasised the point that Putin may be unaware of on the ground feeling because he is quite isolated and doesn't travel much. The last couple of years he relies on briefings. There is always a danger that they will say what they think he wants to hear. Personally I sense a Napoleon and often that much power can sometimes lead to delusions of godlike omnipotence.

Just watched Fiona Hill give her version of events live on zoom with Josh Clancy. It will happen. Putin is possibly unaware of actual feelings in Ukraine but is a better player than anybody we've got. The US won't do anything militarily and it wasn't long ago that Trump was decidedly anti-NATO. It is not the spurious claim by Putin that NATO are surrounding Russia. They have far larger borders with Kazakhstan, Mongolia and China without considering the Arctic. Putin just wants to stay in power (2036) and will do what is necessary to facilitate.
Putin thinks the west is feeble because he knows that he can assassinate opponents at home and abroad without serious kickback. After failing to poison his only real political threat, Navalnay, he just threw him in prison and then welcomed Western businessmen to St. Petersburg for a trade fair. Brezhnev was Ukranian and some say Kruschev was too. It is considered part of the original Russia and it could be argued as close to Russia as Scotland is to England.
I don't know what to make of it but individuals like Putin, Trump and Xi Jinping will do almost anything to stay in power. We don't scare Putin in the slightest imo. Kiev may well fall. It is very close to the Belarus border.
I've no idea what will happen to oil. It might nbe better to be in cash. I think we will just feed the crocodile and make excuses that Ukraine is seriously corrupt and brought it on themselves.

correction - herd protection not immunity

Hi Therapist - I've wondered too. My explanation is that the depressing performance of EnQuest and other similar oil companies is self-fulfilling. As MC's decrease they drop out of the indexes as they move down the chart and out of the criteria used by funds. It is also a problem the other way for techs as funds are forced to buy them as they gain in value. Then there is the ESG lobby and pressure to divest from fossil fuels. They used to say nobody ever got sacked for buying IBM. Well, the same applies to oil companies but the reverse. Nobody will be sacked for not holding them beccause you have herd immunity to an extent.
Overall oil (energy) is the currency of life and I haven't yet seen a product that chooses the most expensive source over the cheapest. They say a barrel of oil is the equivalent of 4 1/2 years of manual labour. I sold my hedge against EnQuest (2 oxen and cart) because I could no longer afford the hay and problems with the smell and the neighbours (the poor beasts never got used to it). They are now owned by an Insulate Britain luminary who is hoping to change legislation to get them motorway legal.
Afraid we're gonna have to wait until the update. Even if outstanding we will still face XR and others so I don't expect a rush into buying but I will be quite happy to top slice (sorry - but it is probably at least a year ahead) and take advantage of buy-backs. I'm actually leaning towards them more than dividend as it gives me more control. The PIK worked wonderfully for me with the RB.
As for the meanderings of the price that is quite simple. The pressure has been a drip, drip sell and apart from events and geopolitical interference usually returns. The 3 D's will always be there on the top (selling) side - Death, Divorce and Debt and you can throw in Disinvestment as a fourth if you like. Fossil fuels have a limited life. Somewhere between 15 and 50 years is my guess. I hope we top up our reserves.

Build it and they will come. I promise.

Possibly a Labour Government. Tonight bringing up the Windfall Tax in a Party Political Broadcast on TV. Jumping on the green bandwagon and promising to insulate homes (again). Where does the money come from? The Energy Crisis is caused by oil companies - eh? Taxpayers have been funnelling money into crackpot renewable schemes that cannot stand up economically on their own two feet. I'd like to know where all the excess profits were? When oil collapsed and along with it most oil company share prices I don't remember any offers to help us through a difficult time. Energy is the currency of life and too important for Governments to weaponise. As a background theme music is it any wonder that investors are still wary of buying ANY oil company. Fundamentals will return and maybe some less populist politicians.
Energy has been too cheap for too long. It gives us cheap food & travel. Take away the cheaper fossil fuels and see what reaction you get around the world! The hypocritical and cynical US must be rubbing their hands with glee at the opportunity to fill the vacuum that Russia/Ukraine may create. Not a rant but maybe a part suggestion for the doldrums around oil companies.

I think it more likely that it was a trade from this morning and only reported later. Could even be staff shortage (entry clerk got Covid). If you're busy entering the ticket is not high priority and anyway why give the other participants information before you have to. There are many trades that participants will agree to post later in the day to shield their actions from others. This is the big boys trading. Old technology like telephones get used.

https://fingfx.thomsonreuters.com/gfx/ce/znpnelonlvl/OIL%20OUTLOOK%20SURVEY%202022-2026.pdf

All credit to John Kemp for doing the work though I'm not sure what it means. 2022 Oil guess: mean $82 mode $85 from 994 responses.

Hi ijgs, Sanchez - I'm not suggesting the Telegraph are innocent but all journalists chase stories and in turn are leaked information. This isn't at whistleblower level. The BBC for instance are always accused of being left or right when in actual fact they usually try to get two parties to comment. Sometimes one is unavailable (like the Tory party). The fact that she is described as a 'Retail Editor' does surprise me a little but then again the tech business is so underrepresented in FTSE stocks perhaps it's an add on for her. It may be even more prosaic than that and she has another connection with the Shadowfall source. Her job is to get eyeballs on to the piece and help sell the newspaper. The piece is contentious and would have been run past the telegraph lawyers. The silence from Darktrace is encouraging.
It is hardly surprising that friendships and contacts are formed between companies and journalists. It happens in every other walk of life.

Former Shell chairman Holliday joins ex-Petrofac boss Asfari at Venterra (Energy Voice). I wonder if AB and Ayman Asfari are still friends?