Menu

Recent Interviews

Stephan Dorfmeister, Finance Department, Deep Nature Project GmbH

Stephan Dorfmeister
Finance Department | Deep Nature Project GmbH
Untere Hauptstraße 168, 7122 Gols (AT)

office@deep-nature.at

+43 681 10139055

Like Aurora Cannabis and Canopy Growth, Deep Nature Project GmbH focuses on value chain


Alison Coutts, Executive Chairman, Memphasys Ltd.

Alison Coutts
Executive Chairman | Memphasys Ltd.
30 Richmond Road, 2140 Homebush West (AUS)

alison.coutts@memphasys.com

+61 2 8415 7300

Memphasys Executive Chairman Alison Coutts on in vitro fertilisation (IVF)


Thomas Soltau, CEO, wallstreet:online capital AG

Thomas Soltau
CEO | wallstreet:online capital AG
Michaelkirchstraße 17/18, 10179 Berlin (D)

service@smartbroker.de

+49 30 27 57 76 464

Smartbroker - wallstreet:online capital AG CEO Thomas Soltau in an interview on the market launch


10. March 2020 | 11:40 CET

Baytex Energy, Husky Energy, Saturn Oil & Gas - why Canadian oil now?

  • Oil

The oil industry around the globe had an unexpected start to the week, marked by a collapse in the price of oil. Last Friday, WTI was still trading at over USD 41.00 per barrel and at the start of the week the price fell briefly to below USD 28.00 per barrel. This was preceded by the announcement that Saudi Arabia will increase its production volume because Russia will not participate in a joint cutback. The defiant reaction of Saudi Arabia sent the oil price and the stock markets around the globe into a downward spiral.

time to read: 2 minutes by Mario Hose


 

World economy as a plaything

There is much room for speculation about the motives and reasons why Russia and Saudi Arabia have not come up with a common ground to curb the amount of oil. The reason for the talks was the decline in demand for oil in connection with the Corona crisis. One possible common reason was that they wanted to slow down the USA, now the largest oil producer. A large part of US production is obtained through cost-intensive fracking, and a low oil price makes the development of new fields uneconomic.

OPEC and Russia miss profits

However, this type of predatory pricing is not cheap. After all, the OPEC countries hold around 80% of global reserves. Since 1960, the population of these countries has risen from less than 100 million people to over 500 million. In countries with a diversified economy, the price of oil plays a more subordinate role than in the producing countries, which are still dependent on the price of 'black gold'.

In 2018, the USA produced around 11.0 million barrels of oil per day. Russia produced around 10.5 million barrels per day in the same period and Saudi Arabia around 10.3 million barrels per day. Of these three countries the economy of the USA is the most broadly based and therefore Russia and Saudi Arabia are currently hurting themselves and the OPEC countries substantially with the lost profit.

Hedging protects the oil market

On the Canadian stock markets, oil producers came under enormous pressure. The market value of Baytex Energy collapsed by 40% to CAD 353 million and Husky Energy fell by over 30% to CAD 3.5 billion. The value of Saturn Oil & Gas declined by 21.7% to CAD 21 million - an amount that is probably not far from the total revenue in 2019. Given that oil producers usually hedge their future production volumes in connection with credit financing at an already agreed price, the price collapse on Monday will hardly be felt in the short term. For investors who assume that the low oil price will only be temporary, the price declines are an excellent entry opportunity.

Importance of the producing countries will increase

In view of the fact that Canada is in a much better position than most OPEC countries when it comes to protecting human rights and the environment, it will only be a matter of time before one or the other oil-producing country is frowned upon by society. Then also the import of OPEC oil to Canada for the mentioned reasons should find an end. Anyone who wants to position themselves in the oil sector with shares will find attractive opportunities in Canada under ethical and moral aspects in the current environment.


Conflict of interest & risk note

In accordance with §34b WpHG we would like to point out that Apaton Finance GmbH as well as partners, authors or employees of Apaton Finance GmbH may hold shares in the aforementioned companies and that there may therefore be a conflict of interest. Further details can be found in our Conflict of Interest & Risk Disclosure.


Related comments:

19. May 2020 | 15:56 CET

BP, Chevron, ENI, Saturn Oil & Gas, Shell, Total - what investors need to know now

  • Oil

About a month ago, market participants around the world learned that the end of a price slide does not have to end at zero on the expiry date of WTI contracts. Anyone who thought that a barrel of American WTI at USD 0.01, which is 159 litres of crude oil, would be a special bargain on the expiration date and took the chance was taught an expensive lesson. The expiration date of 20 April 2020 will go down in history with an initial negative settlement price of USD -37.63. The USA is known to be the land of opportunity and this seems to be another chapter.

Read

11. May 2020 | 08:42 CET

BP, Crescent Point, Saturn Oil & Gas, Shell - the 300% chance of the billionaire?

  • Oil

When renowned financial institutions and billionaires have an opinion, it is often heard in the market, especially when it does not correspond to the current mainstream. The more established the name or the bigger the bank account, the more weight this opinion carries with investors. In recent weeks, the oil price has become a plaything for politicians. The decline in demand for crude oil in connection with the restrictions imposed to contain the spread of the corona pandemic, coupled with inconsistencies within the OPEC+ cartel, have even pushed the futures for WTI oil into negative territory on its expiration date in April. This is an unprecedented situation, which is also a foundation for the creation of new wealth. Billionaire Naguib Sawiris and JP Morgen agree on the price trend and expect high potential.

Read

06. May 2020 | 05:57 CET

BP, Exxon, Shell, Saturn Oil & Gas - Crude oil up to USD 100 in May?

  • Oil

In recent weeks, even experienced investors have learned a lot about the oil market. When the price of WTI slipped into the red in April 2020, this was a first in the history of black gold. On the one hand, the oversupply of producers put pressure on prices, but speculators also caused the distortions. It was a dangerous mixture on the expiry date of the May contracts. In two weeks' time, the June contracts expire and the price development is eagerly awaited, but this time it can also go the other way.

Read