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I disagree with you Jazim.
OP fell due to inventory build in the US. If you read the platts reports you won’t be blaming the drop on an article boasting renewable energy.
Currently we are strongly correlated with OP movement. If you notice OP fell from 70$ to current levels.
To add, IMO the fact the vote is happening this week, SP seems to be anticipating this.
Sageman, can you verify this point? “ in the meantime expect the sp to reach between 75-80p ( allowing for a 50% rise from 250 announcement).” Do we expect an announcement? TULLOW already joined ftse250 on Friday and we saw an increase of 10% on the day!
FT article :
The next five years may be the best five years we’ve ever had for hydrocarbon investing,” Wil VanLoh, head of Quantum Energy Partners, one of the US oil patch’s biggest private investors, told me recently.
Opec production cuts, cheap credit, vast government stimulus spending, and an equity market shift away from tech stocks to “old economy” companies are all providing a tailwind for oil producers.
But underlying the recovery is also a realisation that, no, coronavirus did not fix our addiction to burning fossil fuels. In his recent book on climate change, Bill Gates wrote that last year’s 5 per cent drop in emissions — an outcome of the lockdowns and economic recession — was remarkable not for “how much emissions went down because of the pandemic, but how little”.
The same applies to how much oil we still burn. Less than a year ago, the fashionable talk in the oil market was that the virus had already induced peak oil demand. Even BP boss Bernard Looney said this was possible.
Global GDP shrank last year and the world’s thirst for oil, running at almost 100m barrels a day before the virus hit, plunged at one point by as much as 20 per cent.
Yet despite a glut so great it briefly forced oil prices below zero, consumption still averaged 91m barrels a day — more than the world consumed daily in 2012.
Morgan Stanley thinks demand will be back above 100m barrels later next year. Goldman Sachs expects that marker to be passed before 2021 is out.
Investors are suddenly flocking to previously out-of-fashion companies that promise to meet the world’s renewed hunger for crude.