We are much alike, except I only boughtcalls once and I bought 5 calls as some insurance on my 10 puts just before the earnings call. When I did the above research I thought about buying below $10, but the thought of BK kept me out.
Titus, I thought you were short this? I am still holding my July $10 puts. They were worth quite a bit when this was in the dumps, but I am only into them for pennies (got them when SDRL was at $30). But after I did this research, SDRL seemed like it might be able to struggle through the oil slump. Well if it gets down to $9 again I will close my puts and go long, but I can't be long and short at the same time.
Good luck to you, which ever side you are on!
There is always a "Downward resistance to lower prices". The one key player who is distorting the market is Saudi. They could change conditions over night with a press release. Their intent is to drive out competition (mostly frackers) and they have a bank account to do that. They are also hurting many other countries who depend on oil to maintain their economies as well as our oil companies whose profit ratios have been hurt. But I have not seen dramatic losses reported by any of the majors yet. Have you? I don't follow them that closely, but there have not been any major headlines about Exxon going out of business.
Sleepy... I agree with much of what you have said here and was equally convinced SDRl could not survive since the price of oil has came down so dramatically. But then I did some research on the actual cost of oil production and was shocked. I posted the information I got from the D.O. E. here under this heading: "Here is a list of the ACTUAL COST of production for all oils". It seems like we have been lead to believe that their costs were considerably higher than they actually are. Yes, I know countries like those in the Middle East, Russia and others need oil at a higher rate to run their economies and Exxon, Shell, COP, BP etc. need/want higher prices, but they can still keep pumping oil at current levels and survive.
The costs include drilling the wells, getting it out of the ground and delivering it to a major fuel hub as well as the projected life of the wells and tax and royalties. It is based on the companies reported costs via the IRS, so it should also include the price of running the business.
I expected more replies....This is good infomation and a lot of people (including myself) think or thought the actual costs were higher. Just wanted to pump this back up to the top one last time so anyone who missed the chance to see this has one more chance.
Thanks. But again this is cost basis data. No consideration was given by DOE as th what kind of outside needs beyond the actual cost of production. I am sure Russia has more costs as well and oil companies want the maximum they can get (who doesn't?).
I took these numbers from the DOE website back in Jan. Drill ship rates have also been falling and I am sure it is the same with the frackers. Everybody in the oil ind. is looking for work now, and it's going to get worse before it gets better.
I posted this a while back (Jan 2015), but it is worth re-posting. I spent some time gathering the info so people would have a better understanding of what the different types of oil actually cost. It was below what I thought, but these are facts from D.O.E..
There has been a lot of speculation about the actual cost of producing oil on this board so I looked up the actual costs from the Department of Energy (if you believe the government) this is what they say.
Middle East oil $10 to $36 ..........av $27
Shelf oil $23 to $68 .....................av $41
Heavy oil $32 to $58 ...................av $47
Russian oil $28 to $70 ................av $50
On shore RoW $23 to $72 ..........av $51
Deep water $23 to $72 ...............av $52
Ultra deep water $41 to $70 .......av $56
NAm shale $52 to $72 ................av $65
Oil sands $50 to $80 ...................av $70
Arctic $48 to $88 ........................av $75
These numbers are from their website so if anyone wants to argue go to them. The reason for the range of numbers is location, transportation (access to pipelines etc,) and productivity.
They also note that changes in sand and drilling techniques have made North American shale oil less expensive while drilling rates and transportation costs have made off shore oil slightly more expensive.
They also note drill rig counts have been decreasing sharply and may stabilize the price. .
Hopefully this clears it up once and forall. I spent some time doing this for everyone.
It looks to me that almost everyone should be able to live with $50 oil but some of the higher cost wells
above the $50 price will be losing money and will be shut down until they are profitable. A number of about $50~$70 bbl is where I think we will end up based on this, not $100 or $150. In fact it looks like we have been getting screwed for a long while.
Agreed, there are a lot of people like that on boards like this. Thanks for the support and a_aline as well.
11 full time employees, losing money hand over fist. The old pump and dump game does not work anymore fellas. The internet has opened doors previously only available to some but now everybody can see. Kind of like cold calls, maybe it works sometimes, but not very often and I guess those who fall for it deserve it. Anybody still holding should jump ship now. It's about ready to DIVE. (IMHO)
Sentiment: Strong Sell
Their mailbox is full and cannot take messages. That is what you get when you call. This is the second follow-on offering of stock in as many months. I got out at $31 and broke even. Soooooo Glad I blew off these burger flipping bandits. They think this is their piggy bank and your poor investment choice. They are going to keep offering more stock all the way down. What a bunch of children in charge!!!!!
Sentiment: Strong Sell
Something is wrong with your K on your keyboard. I read that lenders note and it certainly did give the stock a lift. The biggest question is how long will the oil glut last and how much patience can the banks have. If the payments dry-up with the idle ships during the glut I suspect their tolerance will wane. If interest rates go up (only a slight possibility, but a possibility none-the-less) what will they do about the SDRL loans? JF must have some friends at the bank. This is certainly an interesting dilemma for all concerned. I would not bet the farm on it, either way though. I only have about $2K invested it $10 July puts I bought for 20 cents many months ago. And I only bought them then to try and convince a friend to get out of this when it was in the $30's. Time is against me now and oil seems to have found a bottom. I will close them on the next dip in oil. As volatile as oil has become, there certainly will be another dip. It has been an interesting ride. With so many experts claiming they were right on each change in oil pricing it has been somewhat entertaining to watch. IVO and others come out when oil goes up and Titus and others come out when oil goes down. It would be better if IVO wasn't such a Brazilian #$%$.
I don't. I own 10 July put contracts at $10. Bought them for almost nothing 6 months ago to show a friend how seriouly I felt this stock was going to go down. He said I had no skin in the game so I bought these (wish I had bought more). SDRL was over $30 and he has now lost close to $100K. He feels like many of the longs here and still won't give up on this. My time is running out on the puts and they have been worth a lot more than they are now. May close soon. But this is still a broken company, IMHO.
And what if oil stays at the $50~$60 price range. Oil bounced yesterday because the Saudi's raised their price slightly to some customers. Also remember that BP cancelled their SDRL contract for the West Sirius Rig in the Gulf of Mexico without considering the Russian cancellations and others (Brazil, PBR)
Yes, SDRL has the newest and best ultra deep water fleet, but if they are idle they are costing you money and a raise in interest rates will be a death sentence.
Another fake ID. This and bjosh999 are really Ivodirect in bear clothing. He was a bull all the way down and now he's posting as a bear. He got so embarrassed by his bad calls he had to abandon his ID.'s. Lives in Brazil (who like him) is going to hell in a handbasket.
5 posts | Last Activity: 8 hours ago
Member since: Apr 3, 2015
The real Audio handle was audiophul
This is not the real Audio. He is a nice guy and I am sure he is feeling pain, but I know him well enough from our exchanges earlier he would not cry like this. This is a dup sign-on and he is having his fun. I guess the real Audio rubbed him a bit too hard once (he could do that). Cooking my Easter ham in the morning to celebrate Easter in the AM. I hope everyone has a nice holiday and peace on earth and let this go. He has suffered enough of a loss without further ridicule. Just let it go.