Geopolitical uncertainties - Sibanye Stillwater, Saturn Oil + Gas and Barrick Gold benefit

Saturn Oil & Gas - New high for the year

Geopolitical tensions are once again a key factor in the price trend on the oil markets. Concerns about an escalation of conflicts in the Middle East have intensified significantly following the attack on the Iranian embassy in Damascus. The world is eagerly awaiting Iran's response, which blames Israel for the incident, leading to increasing unrest in the financial markets. One of the main beneficiaries, alongside the crisis currency gold, is oil. Brent oil is approaching the magical sound barrier of USD 100 per barrel, just like WTI, which would result in a further increase in momentum.

In addition to the base prices, shares in oil producers are benefiting enormously. For example, Saturn Oil & Gas shares have already posted a performance of 25% since the beginning of the year and, at CAD 2.75, have reached their highest level since October of last year. The Canadian share is only marginally behind the next resistance level. Overcoming the CAD 2.79 mark would generate further upside potential to the CAD 3.06 range.

Fundamentally, the fast-growing energy company was able to announce a final agreement on the sale of its non-core concession area in North Alberta for a volume of CAD 27 million. Saturn Oil & Gas continues to streamline its portfolio to increase operating efficiency and reduce net debt, strengthening the balance sheet.

Barrick Gold, Newmont, with high catch-up potential

The gold price is rushing from one record high to the next. After sustainably overcoming the USD 2,145 mark, the old interim high from December 2023, the gold producers around Barrick, Newmont and Co. began to catch up with the advance in the base price. As a reminder: Barrick Gold, the world's second-largest gold producer, is still down more than 70% on its 2010 high, while the leader, Newmont, has lost a whopping 54% since its all-time high in April 2022.

Chairman John Thornton confirmed in the Company's recently published Information Circular 2024 that Barrick Gold remains on a good strategic path. "Barrick Gold is guided by a long-term, forward-looking strategy that is precisely aligned with the demands and expectations of a rapidly changing world. It aims not only to ensure the Company's sustained profitability but also to put sustainability at the core of its operations in every respect. Barrick's pioneering partnership philosophy, a key element of its commitment to sustainability, has already transformed the once derelict Tanzanian mines into a complex with Tier 1 potential, restored the Reko-Diq project in Pakistan, and is now developing it into one of the largest copper-gold producers in the world. After three years of negotiations, an agreement has been reached to reopen the Porgera gold mine in Papua New Guinea, where mining and processing have resumed and will ramp up over the next two quarters," he says.

Sibanye Stillwater - Great opportunities after the shock

Sibanye Stillwater is a player that came under huge pressure following the publication of its figures a few weeks ago but has considerable potential. One advantage of the South African mining company is the diversification of its portfolio. In addition to the mining of precious metals of the platinum group, such as platinum, palladium, ruthenium and rhodium, as well as gold, the production of critical metals, such as nickel, chromium, and copper, is also being accelerated.

In its latest figures, the Company reported a loss of over USD 2 billion and announced the suspension of dividend payments. However, the loss did not result from the operating cash flow, but rather from a special write-down.

One catalyst for Sibanye is, of course, the sharp rise in the price of gold. As a result, the Company's South African gold business, which has been heavily loss-making in recent years, could see profits bubble up again. The market capitalization currently stands at USD 3.74 billion. In contrast, the Company has reserves and resources of over 300 million ounces of platinum metals and 60 million ounces of gold. Sibanye Stillwater could, therefore, outperform the stock market if the market environment remains positive.

The uncertain geopolitical situation is fueling both gold and silver, as well as the oil market. Saturn Oil could generate a further buy signal by overcoming resistance at CAD 2.79. Barrick Gold and Newmont should continue to close the gap to the base price in a positive environment. Sibanye Stillwater has gigantic reserves and should perform with leverage on the gold market.