I believe Saudi will not cut production at the Nov 27th meeting of OPEC. Saudi has plenty of money to get by with low crude prices for now. And Saudi doesn't want to reward Iran's nuclear program by cutting production which would raise prices for Crude. Lower crude prices will also get result in a lot of Holiday driving here in the US which will help ease the excess supply, then create more demand and higher prices after Christmas driving period. Thus the Saudi's will help the excess supply and create more demand.
My question to the board here is -- If there is no OPEC production cut at the Nov 27th OPEC meeting, will that result in KOG stock price dropping for a short time period? I'm thinking it may drop for a short time period, then when demand increases, KOG stock price will increase. any input will be appreciated. Regards.
After the Nov dividend it only has one more dividend remaining in Feb. How do you get that it has 3 dividends remaining (actually you have 2 remaining after the Nov 2014 dividend --- so how do you have 2 dividend remaining?). Thanks in advance.
China -- There is plenty of oil going to China's SPR. Quote from Bloomberg: 11/20/14
"Petroleum Argus, the energy industry publication, estimates that China has a total of 150m barrels of reserves in its seven completed strategic depots. Energy Aspects, a London-based consultant, reckons China has bought about 87m barrels of crude for its SPR in 2014, a figure that could rise by another 20m barrels by the end of the year.
Stocks held in the four depots belonging to the first part of China’s stockpile amount to roughly nine days of consumption, well short of the 90 days of imports recommended by the International Energy Agency. China imports roughly 60 per cent of the crude that it uses.
If China is aiming for 90 days of import cover, Energy Aspects estimates China will need to hold 540-600m barrels of crude into its SPR."
This is a great article by Bloomberg -- and it points to China wanting to take all the oil it can store off the market at these low prices of today, IMHO. Regards.
I agree, Hamm just reduced the companies debt to equity by selling the hedges. It's a gamble, and if prices stay low, he wins since he got $500M selling the hedges and is equipped to buyout other Bakken producers who are strapped for cash flow. If prices rise, Hamm wins again since he will have the cash from selling hedges plus new high crude prices.
Its sort of the take bird in hand, or beat on getting 2 in the bush. I think the China buying as much oil as it can deal will be what drives the price of crude. I need to look up and see what their SPR size is now, and what they are planning it to be. Regards.
I'm not a fan of Chad, but he makes some good points. Our POTUS will do anything to help his ego, and pushing Putin around by attacking Russia's main source of income via crude oil prices and/or preventing Russia to use new technologies to explore and produce crude oil is one way Obama has used to punish Russia. Chad has a point about who is invading other countries --- Russia, or US? Russia's Ukraine situation is their business, not ours. Parts of the Ukraine that sided with the #$%$ Germany Army in WWII are not liked by Russians, nor Ukrainian Russians. The US would not allow a border country that was a threat to the US to do what they wanted. Again, Im no fan of Chad, but he makes some good points .... not all of them, but some important ones, while the US news media serves US citizens the Koolaid. Enough.
This is a total disregard for the stock holders. The prospects to be drilled and the successful zrat well with proved gas and condensate is totally gone IMHO. The management simply sucked all the money the company had to pay for their no performance. This is a small company, but I hope the Houston and Edmonton papers do an article on the management -- how they screwed over the stock holders of SOQ. This #$%$ me off. These 'managers' are total cowards, and inept at what they do, and are a total disgrace to the Oil & Gas Industry. I'm going to see if they are AAPG members, and if so will make a complaint to the AAPG regarding SOQ's mismanagement. OK folks, has been nice communicating with you over the years, assume the message site will be next to go down? Regards,
Symon - Thanks for the post with some good points regarding KOG. You said you missed buying KOG below $9 on the recent dip. If you had bought KOG below $9, when or at what price would you sell KOG at if you had bought it?
Even if they do not merge, that's a good move regarding taxes since WLL and KOG essentially trade in tandem. Should be interesting how KOG will be viewed after the earnings report. As others posted they may be reporting 50 cents per share vs last quarters 8 cents per share.
Also, just wondering, if Saudi/OPEC'ers are keeping crude prices low to run the shale oil companies out of business, wouldn't this be a great time for some majors to add shale oil acreage/reserves on the cheap. If so, what do you think a fair acquisition price would be for KOG?? Regards.
I agree the sanctions are not the way to go for free markets. But our POTUS is not a big fan of free markets nor large corporations. Lets see if the US and weak EU withdraws the sanctions now that Putin has ordered his 17,000 troops home from their training exercises in the Ukraine. Regards.
Putin pulling back 17,000 troops. Putin says their training mission is over there. This is good for Exxon. Now Obama and the EU needs to drop the sanctions. But knowing Obama, that may not happen if he pounds his chest and gloats his ego as if he has done something meaningful. Let the multiple energy companies and their many service companies get back to work in Russia. Regards
Mercy, anyone can read a chart of past prices. That means nothing unless you actually sold at the highs and bought at the lows. Regards.
Sentiment: Strong Buy
PS --- And thanks for your history of how you traded KOG. Regards.
You are not the only one who bought KOG in the 3's, out at 6's, back in later, etc. I have not shorted the stock because that is not what I do, etc. The production rates and rapid decline are all cooked into the economics. We used to drill these type wells back in 1990 with horizontal drilling and the beginning of multi-stage fracing, so I know how they produce. I actually tried to get my company more involved with horizontal drilling back in 1990 since the talented group of folks I worked with were years ahead of the industry, but my company wanted to get out of the horizontal rapid decline type play. Anyway, sounds like you made a ton with your shorting, and then buying when it pulled back. Good deal, and good luck to you. Regards.
Sorry billnuts, I sold at 16.14, and rebought at $14.57 ..... thus KOG would have to drop below 13.00 before I would lose anything. My ignore was in reference to your advice. I'm asking other longs why they are holding since different folks have different reasons. That's why you try to collect various input from multiple other folks to learn. I assumed you would know that, but it doesnt sound as if you do. Regardless, good luck to you. Regards.
I'm ignoringbillnuts98, but I would like to hear from other longs like myself for their reasons to hang on to KOG. It is getting beat down with the price of crude dropping, and I'd like to hear some sound reasons to hang on to KOG. It's getting lonely down here at $14.37? Regards.
Mercy, if Russia and Saudi are going to meet, it needs to happen fast because oil is dropping and it is staying down. If Russia and Saudi can bolster up the price of crude, that would be great. Until that long shot happens, we are doing the downward spiral. Regards.
Nice post with information that is not opinionated. Explaining the refinery cycle in words the general public can understand. It should be interesting where crude prices hit bottom during the current cycle. I think $90/bbl WTI will be the bottom -- just my guess. Regards.
Here is another Forbes article where they say the sanctions will cause the price of oil to go up which will help Exxon (by Ken Rapoza).
"Russia no longer plays a prominent role in adding to non-OPEC supplies, but a decline has the potential to drag down non-OPEC oil output, Barclays Capital warned. This will push oil prices higher in the near-term."
The sanctions will not hurt Exxon. This is spelled out nicely in the article by Forbe's Chris Helman which you picked apart to make your post here. Helman's article that you picked your information from is very clear that the sanctions will not hurt Exxon. If you are going to use quote for quote information from Helman's article, at least give him credit for information in your post. You literally plagiarized his entire article and posted it as if it was your information/writing. Helman also does NOT endorse your Strong Sell of Exxon anywhere in his article. Regards.