Petrofac Share Discussion Threads

[pogue] 01/10/2018 19:51

Brent went up about 2% today $83 to $85 PFC went up about 1.5% ie 10p not a lot in it.

[cinquepercento] 01/10/2018 17:12

I see we have $84 or so a barrel at the moment so hopefully this will give a bit of a push up to Petrofac which seems to dragging its feet a little at the moment.
I am surprised that it has not picked up the pace a bit yet.

[wolfhound1] 30/9/2018 14:29

Lol, fair play Pogue,... I agree best to look at both ends of the arguement and truth will probably end up somewhere in the middle

...the middle of course keeps moving over time

[pogue] 30/9/2018 14:16

Yup I dont generally take more than a passing interest in them but since you posted one on $100 I felt I should balance it :0)

[wolfhound1] 28/9/2018 18:08

More likely it don't suit GS for Oil to rise... possibly havent built a large enough long position......yet....lol

Research views can switch short to long quicker than a vicar after liquor

[pogue] 28/9/2018 16:03

never hit $100 oil
hxxps://oilprice.com/Energy/Oil-Prices/Goldman-Sachs-Oil-Prices-Wont-Hit-100.html
and Goldmans are usually bullish on oil

[wolfhound1] 28/9/2018 15:42

$100 oil

hxxps://www.thenational.ae/business/energy/brent-could-rally-up-to-100-even-as-it-breaches-the-80-mark-1.773524

[pogue] 28/9/2018 12:12

cinque
anything is possible but basically yes.
I never mentioned elect vehicles though but I expect the rise in cars in China and India to compensate in a large part for Western changes in vehicles plus the obvious fact there is nowhere to charge them :0) I did read yesterday American consumption of oil for road vehicles has gone down but consumption of oil has gone up slightly overall showing they are using more oil in industry in plastics etc so car driving is not the only driver of consumption even in the West.

[cinquepercento] 28/9/2018 10:08

Very interesting posts,Wolfhound and Pogue:

So are you both basically saying:
Eventual Fall out from trade wars and sanctions.
Recession imminent next year or so.
Collapse of share prices etc:
Interests rates up,gold prices down initially and then heading up again and that we will finally get the next recession similar to that of 2008,which to me is overdue since about 2015/2016?
As far as oil prices go,surely the ever increasing numbers of electric vehicles and solar energy would keep a lid on things.

[pogue] 28/9/2018 09:15

We do seem broadly to agree. Not convinced of the $120 happening but in the unlikely event of missiles flying to and from Iran anything is possible short term.

[pogue] 28/9/2018 08:05

Wolfhound
oil price rises are driven by increased demand at the margins therefore the countries dramatically increasing demand will set the price ie the Far East. Having the highest demand is not important if it not changing that much just like how inflation is calculated on changing prices not how much it was to start with.
Strong recovery in US is being driven by sanctions forcing Americans to source goods in the US. Short term this is good for US long term it’s bad for everyone. Short term it drives up employment but this drives up costs due to labour being more expensive in the US thus inflation rises making rate rises inevitable which in turn increases the value of the $, all this has started to happen.The rising $ makes oil more expensive and American exports of goods which then hits the US economy. The rising $ hammers EMs debt in $s and oil purchases which cuts everyone’s trade. China having large reserves is not going to stop any of that so am not seeing the upside.

[ken tennis] 28/9/2018 06:28

POGUE great post your a very intellectual guy.

[wolfhound1] 27/9/2018 23:09

Thanks Pogue,

Re oil link, bit old google 2017 crude oil importers - it will flag the top 15 (include much of europe) that makes up 85% of crude imports. What is also worth noting is that all had large reduction in demand on the yrs 2013-17. Also worth niting China now outstrips USA.

As for EM, the biggest China had $4trillion in reserved..... their fate will be driven by demand from US and EU and Asia - all three are showing strong signs of recovery, so barrung a natural disaster thatshould keep demand ticking along - biggest china - can just chuck money as infrastructure profects to weather the storm

[pogue] 27/9/2018 19:31

wolfhound
I dont think think a 2% increase in American oil demand has propelled oil from $30 to $75. Have a look at oil consumption around the globe look at the graph on the side of this webpage
consumption is rising in the Far East and any weakness in China due to sanctions could easily lead to a demand fall.

Plenty of people think there is going to be a large spike up but then I bet against the perceived wisdom a couple of years ago that it was going to stay 'lower for longer' around $30 $40 and started buying oil based stocks. I am not saying I will be right this time too but there is a strong feel of hyperbole going around just now from a lot of news sources and traders. Your view that it will take a while to lessen demand is fine however its supply that is the real issue if that rises in response to high prices which is the normal way of things. Venezuela has brought in private companies to fix their wells, the Permian is getting a new pipeline next year to clear horrific bottlenecks preventing them getting oil out plus other projects that I am seeing getting moved very quickly to production. The increased supply along with the realization that Iran will still be exporting despite sanctions will IMHO reduce the oil price next year with volatility until then

If you think emerging markets are ringfenced then you should take a look at where their money came from.
The other major effect of collapsing EMs is the hit to world trade. Trade is what makes everyone money in this world. Its a large bomb if it goes off there could be a lot of fallout.

Not sure about your point on Iran you saying nobody likes them so it doesn't matter? UK, France, China and Russia are currently trying to work out ways to bypass US sanctions on Iran they have friends and the mix of them says a lot about how many people dislike Trump's sanctions.

Thank you for your replies.

[cinquepercento] 27/9/2018 16:36

Meanwhile,the Petrofac week chart trend and the month chart trend are still a straight line going steadily up.

It can drop to 643 and still be just within the upward week trend.

We need it to break through the 675/680 mark.

[wolfhound1] 27/9/2018 15:54

Pogue, underlying oil has gone up from $30 to $75+ a 150% increase, adverse FX rates in China, India,Japan S Korea and EU -v- $ might have added 5-15% on top of the cost when payed into local ccy. The strength of US economy has been the driver of FX rates but also of increased demand....double whammy effect.

Where Oil will go...will be driven by markets and speculation....as I said I think Trump might try to hold back but inevitably 2019 will see it spike IMHO.

If Emerging Markets is the catalyst for next market shock - who knows, my point was that we dont have the same toxic mix that were repackaged and sold globally - if emerging takes a hit then it is largely self contained in the EM space.
As to Iran, they have since the over trrow of the Shaw in the 70's the US main bogeyman.....no one in press will come out in support and say DT was stupid to impose sanctions....as long as they think Iran are gettng hammered and denied access to global markets.

I can see Oil spike much higher in 2019....demand is a super tanker and it takes along time before it comes to a stop and reverses........GLA

[bouleversee] 27/9/2018 11:24

Hope you are right because I was still losing most of my investment in UKOG yesterday!

[stephen2010] 27/9/2018 11:03

Check out UKOG Extended flow test about to start anyday now on the Kimerage zones which flowed at over 1300 bopd agregate in 2016 on the short term flow test. Also official declaration of commerciality to be announced anyday, on the recently sucessful flow test of the portland zone, on their Horse Hill descovery well.
About to re-rate so be quick. Fully funded into 2019. Huge huge upside! DYOY :)

[pogue] 27/9/2018 07:20

Wolfhound
the price of oil doesn't need to go that high as this time the $ is a lot storng against other currencies and therefore the actual cost of oil to buy in some countries is a lot higher relatively.
Cheap money for mortgages was the last reason for a crisis every crisis/downturn is different this time it will be emerging markets the article seems to predict.
Agree Trump will sit on oil prices in America until after November and use the strategic reserve if all else fails citing a crisis as OPEC refuse to listen to him or something equally stupid. I can't believe nobody is pointing out in the press the reason for rising oil prices is mainly his foreign policy on Iran not OPEC refusing to listen, or being able to, comply with his demands.

[wolfhound1] 26/9/2018 14:46

Not so sure we are close to 2008 levels as the academic here would suggest.
1. Back in 2008 the mighty GS was talking of Oil hitting $200, at $80 we have alot of way to go.....from memory oil might have actually peaked briefly at $150/$160 ( twice current levels)just before crash.
2. Securitisation markets - have been fundamentally frozen at close to zero activity for last decade, it waa the cheap money from banks lending se uritising and lending again that created cheap money and eventually fuelled the "flipper tip ya tip her" mortgage crazy that was ezported from US
3. Banks and derivatives - banks now have to hold close to double the capital on trafing than they did in 2008, so now they have been much more frugal in lending with much tighter risk controls and valuation multiples.... albeit they are relaxibg that somewhat as economy recovers but we are a long way from 08 levels. Yhe second strand was derivatives and thise now are handelled in a much more structured and transparent way with much reduced risk appetite...at times down right pedestrian.

That is not to say we wont get a market correctuon but i dont see it anywhere near 2008 levels when it arrive.

I would also say Trump will try keeping a lid on price at pumps til after mid-terms. If Dem get in and oil continues to rise then he will blame Democrats.....and say to his fan base you needs to re-elect me cos look at what a mess the Dec are making since taking over the house and who else is going to stand up to them..... always be thinking two steps ahead.....

[pogue] 26/9/2018 11:33

As a followup to my prdiction above for the future I found this article today which highlights many of the points that may play out. Pure bear porn but logical in many ways.
hxxps://www.project-syndicate.org/commentary/financial-crisis-in-2020-worse-than-2008-by-nouriel-roubini-and-brunello-rosa-2018-09

[pogue] 25/9/2018 20:59

Ken
I follow the oil price closely as my job literally depends on the price of oil.
The worry of OPEC+ is high oil prices kills demand they wanted oil in the $70 to $80 range to keep a nice profit but also keep demand rising because as price goes higher people start looking at substituting or even stop using oil products. A bigger issue though is that the $ is strong right now and that is badly effecting consumption for some countries whose currency is weak so even $80 is very expensive. There are a lot of variables out there just now.
My personal view is that the oil price should hold up to the end of the year then next year the downward pressures of world trade dropping due to Trump's policies and even Brexit may bring it down plus we are nearing the end of the current economic cycle so a downturn is due at some point which is again bad for consumption. A lot can happen before then though and many possible scenarios both positive and negative. Place your bets|

[ken tennis] 25/9/2018 15:25

POGUE thank you for your input you obviously study the situation more in depth than I do however I did know about the decision by Saudi and the Russians basically sticking 1 finger up to Trump, if it goes to $85 or even further it wont hurt Saudi or Russia but trump will be waving the sword like the maniac he is.
keep the good info coming POUGUE you can never get enough good info, and this board is pretty good compared to most.

ATB Ken