Written on Saturday June 5th:
The Financial Times’ article of last week made it clear to which extent BP and the rest of the US offshore drillers will be under the thumb of the Obama administration.
My personal view is that this impact is today calculated into the shares of BP (trading at 37,16) and Transocean (trading at 50,20). An opportunity in the coming weeks for people with a stomach?
On the more safe side: with this BP event, there will be ever increasing importance placed on reserves which will not be affected by the Obama administration. While pressures from pending U.S. legislation on oil drilling may pressure international governments to apply similar restrictions on offshore drilling, Brazil will not be one of them. Petrobras will enjoy vigorous drilling offshore on their newly discovered Tupi field. This massive find contains by conservative estimates around 6 – 8 billion barrels of oil and gas.
Actually, last Friday Bloomberg reported Petrobras did yet another oil find at the Marlim fields, adding another 380 million barrels to their reserves.
Petrobras is trading at 36,06, 50% down from its May 2009 72,38 top.
Petrobras will be good for Brazil, no doubt. And the BP events will add to this. But will Petrobras be good to its shareholders? Brazil has made it evidently clear that they intend to use Brazil’s new Tupi oil field as a springboard for their domestic economy. The Tupi oil field will become the platform which Brazil will use to invest in Education, Social Services, Infrastructure, etc.
The bets are out, end July / early August, Petrobras will organize a share offering of between US$ 50 and 60 billion, amongst the world’s largest ever launched.
And there is also…
Total
Repsol
Suncor
To put on your radar.
In my opinion, oil futures will be back at USD 85 – 90 next winter; US slows down drastically all of a sudden.
And did we hear Obama shout “Natural Gas” and “Nuclear Energy” in the same sentence?
UNG +
GAS
CYMGF +
FCG
Let’s put the flag out on a 100 portfolio:
BP: 5 at 37,16
RIG: 8 at 50,20
PBR: 12 at 36,06
TOT: 17 at 45,25
REP: 11 at 19,05
SU: 6 at 32,56
UNG: 15 at 8,18
GAS: 3 at 39,57
CYMGF: 17 at 3,92
FCG: 6 at 16,63
In August 2011 we dig this up again.
Tags: oil brazil, petrobras
