How hedging hurts oil prices

During the recent negotiations among OPEC and other oil-producing nations to strike an oil production cuts deal, market observers may have been confused when Mexico balked at the figure suggested to them.  After all, wouldn’t Mexico benefit along with other oil-producing nations from constrained supply?

Can the U.S. seriously be considering an oil embargo?

Saudi Arabia, OPEC’s de facto leader, and Russia recently failed to agree to extend (and deepen) their oil production cuts agreement, thereby precipitating decisions to cut oil prices and expand production.  Hitting markets roiled by coronavirus (COVID-19), the impact has been seismic.

themoneynarrative oil and gas commentary (OPEC) – update #16

Today (March 11, 2020), OPEC released its latest Monthly Oil Market Report.  The highlights are indicated below themoneynarrative’s comments.

Understanding market gyrations #2

Many U.S. shale oil producers have a high cost of production, something that kingpin Saudi Arabia does not need to contend with.  As a result, any prolonged oil price weakness will have a severe impact upon their viability, although prior hedging of 2020 production leaves many shale producers a narrow margin in which to remain profitable.

Painted Pony Energy (PONY.TO) – working towards a bright future

A themoneynarrative reader asked us for comments regarding PONY.TO and our investment in the company, which we are publishing as a full post since the subject is of relevance to readers generally. 

themoneynarrative tips and pointers #19 (company news and industry trends)

The value of a listed issuer in the long term is largely a function of its ability to generate profits for shareholders.  Its share price at any point in time, by contrast, is more a function of various factors (which are constantly in flux) and shareholder perceptions.