Good discussion of why energy equity prices have lagged crude rise and what to look for as indication (analyst believes is already starting) that the trend is reversing, and what could be in store.
https://www.bloomberg.com/news/videos/2 ... says-video
Bloomberg: Interesting analyst discussion re energy equities
Re: Bloomberg: Interesting analyst discussion re energy equi
VERY GOOD VIDEO THAT YOU ALL NEED TO WATCH.
I have never seen high quality upstream companies like our Sweet 16 so undervalued by the market. When the rotation back into energy begins, these are the names that will draw more attention. The first big wave should be into our "Elite Eight", the stocks that are highlighted on the Sweet 16 Spreadsheet.
I have never seen high quality upstream companies like our Sweet 16 so undervalued by the market. When the rotation back into energy begins, these are the names that will draw more attention. The first big wave should be into our "Elite Eight", the stocks that are highlighted on the Sweet 16 Spreadsheet.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Bloomberg: Interesting analyst discussion re energy equi
The "paradigm" on Wall Street is just starting to shift. Solid Q1 results and $70/bbl WTI should cause a MAJOR ROTATION into energy stocks.
Frackers Preach Patience on Payoff From $70 Oil, Growth in Shale. Bloomberg.
The world’s biggest oilfield service companies have a message for investors: There’s a payoff for patience. While first-quarter earnings were less than exciting, Schlumberger Ltd., the largest service provider, said it plans to profitably add about 1 million horsepower worth of rock-crushing pumps this year into North American shale. Halliburton Co., the fracking king, said it sees a return to the 20 percent profit margins last seen before the downturn. Their optimism comes as oil prices drive toward $70 a barrel in New York, a strong psychological signal of recovery, while Saudi Arabia has said it sees $80 oil in the foreseeable future. Prices at that level could loosen the leash on what explorers will pay service providers to open their wells moving forward. "I’m excited about the outlook for North America and our March exit margins clearly demonstrate our path to normalized margins," said Jeff Miller, the Halliburton chief executive officer, on a conference call Monday after earnings were released.
This Is Big Oil’s Quarter to Lose. Bloomberg, opinion.
By this time next week, we’ll know how the big five Western oil majors – Exxon Mobil Corp., Chevron Corp., Royal Dutch Shell Plc, BP Plc and Total SA – did in the first quarter. To be honest, we kind of know already: The average crude oil price and benchmark refining margin were up 23 percent and 12 percent, year over year. Not that it has done them much good up to this point. Investors, often derided for their short memories, have developed an elephantine grudge for oil companies. And who can blame them? The majors talk a good game about discipline and multi-decade horizons and all that. But when push came to shove, during the extended oil rally for most of the decade after 2004, they spent like crazy and trashed their returns. Yet that’s precisely why this earnings season is theirs to lose. One of the things exposed by the oil crash was the majors’ inflexibility: Big investment budgets stayed big even as revenue dropped away, squeezing cash flow. However, these five majors are now forecast to report their largest collective haul of free cash flow since the first quarter of 2012 – when oil averaged more than $118 a barrel.
Oil explorers see confidence return after shale shock, price downturn. Platts.
Oil and gas exploration is regaining momentum after the lean years in which budgets were slashed, with seismic technology and greater flexibility by governments able to help yield a new crop of giant discoveries, executives at a London conference said Tuesday. Opening the International Petroleum Summit in London, BP chief executive Bob Dudley said the conventional deepwater oil industry was not threatened by the competitive advantages of US shale. "The deepwater looks very attractive in many places in the world so I don't think it's either-or," Dudley said. "Exploration is not over by any means. What's more prevalent now is the amazing amount of data analytics you can do on seismic to make a decision [on whether] you want to explore and raise the probability of a find. That's probably the biggest change. There's still lots of exploration happening."
Frackers Preach Patience on Payoff From $70 Oil, Growth in Shale. Bloomberg.
The world’s biggest oilfield service companies have a message for investors: There’s a payoff for patience. While first-quarter earnings were less than exciting, Schlumberger Ltd., the largest service provider, said it plans to profitably add about 1 million horsepower worth of rock-crushing pumps this year into North American shale. Halliburton Co., the fracking king, said it sees a return to the 20 percent profit margins last seen before the downturn. Their optimism comes as oil prices drive toward $70 a barrel in New York, a strong psychological signal of recovery, while Saudi Arabia has said it sees $80 oil in the foreseeable future. Prices at that level could loosen the leash on what explorers will pay service providers to open their wells moving forward. "I’m excited about the outlook for North America and our March exit margins clearly demonstrate our path to normalized margins," said Jeff Miller, the Halliburton chief executive officer, on a conference call Monday after earnings were released.
This Is Big Oil’s Quarter to Lose. Bloomberg, opinion.
By this time next week, we’ll know how the big five Western oil majors – Exxon Mobil Corp., Chevron Corp., Royal Dutch Shell Plc, BP Plc and Total SA – did in the first quarter. To be honest, we kind of know already: The average crude oil price and benchmark refining margin were up 23 percent and 12 percent, year over year. Not that it has done them much good up to this point. Investors, often derided for their short memories, have developed an elephantine grudge for oil companies. And who can blame them? The majors talk a good game about discipline and multi-decade horizons and all that. But when push came to shove, during the extended oil rally for most of the decade after 2004, they spent like crazy and trashed their returns. Yet that’s precisely why this earnings season is theirs to lose. One of the things exposed by the oil crash was the majors’ inflexibility: Big investment budgets stayed big even as revenue dropped away, squeezing cash flow. However, these five majors are now forecast to report their largest collective haul of free cash flow since the first quarter of 2012 – when oil averaged more than $118 a barrel.
Oil explorers see confidence return after shale shock, price downturn. Platts.
Oil and gas exploration is regaining momentum after the lean years in which budgets were slashed, with seismic technology and greater flexibility by governments able to help yield a new crop of giant discoveries, executives at a London conference said Tuesday. Opening the International Petroleum Summit in London, BP chief executive Bob Dudley said the conventional deepwater oil industry was not threatened by the competitive advantages of US shale. "The deepwater looks very attractive in many places in the world so I don't think it's either-or," Dudley said. "Exploration is not over by any means. What's more prevalent now is the amazing amount of data analytics you can do on seismic to make a decision [on whether] you want to explore and raise the probability of a find. That's probably the biggest change. There's still lots of exploration happening."
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group