Wear the label with pride Doug. Thoroughly reading and seeking to understand company announcements and comparing those to its peer and the overall sector make for better investments (IMO).
Don't disagree with you per se - I should have added Goshen county follies to the Roosevelt moonshot - HOWEVER, those strategies were telegraphed and described. The SSN shareholder needed to evaluate was this the appropriate strategy. In the $100+ oil price world with seemingly no cap on price much less an oversupply created price collapse, defining a new oil province might well have been a good strategy - if you were EOG or CVX. Perspective I guess. That may well have been the time to exit. NEVER CONFUSE A COMPANY'S AMBITION WITH IT'S ABILITY!
Thus I agree mgmt should be held accountable for their decisions. However those decisions were made in good faith I believe. Doesn't mean the CEO survives the chopping block (e.g. David Knox @ Santos).
Now on a much more positive note, CVX gave this outlook on its earning call:
"Prices are low because the market is producing more than consumers want, but the markets are showing signs of rebalancing ... The success of shale in the U.S. and some growing production from Iraq allowed the market to rebalance for first several months of 2014. However, note the spike in production when the Saudis increased production and the shale growth continued its surge in late 2014. The resultant 2 million barrels per day surplus has pushed prices down."
Stating the obvious, but referencing a graph with data supplied by Wood Mackenzie
"Markets will likely rebalance at some point next year, though seasonal demand patterns are apt to blur the exact timing. With a new equilibrium will come price recovery, which is one of the levers that will help balance our cash equation. While we're confident in a price recovery, the timing, of course, is uncertain."
Now that isn't exactly saying something new that we already don't intuitively accept as probable - i.e. oil prices are going to recover but we aren't certain as to when. OK so there are a couple of things in CVX statement:
1) market (i.e. supply/demand for oil) to rebalance some point next year - so figure about another 12 months of "pain".
2) price recovery - but to what level? CVX is looking (needs??) for a $75ish Brent oil price of FCF breakeven (i.e. after paying its dividend).
3) nothing said about the "slope" of the recovery. How gradual is it?
Just something to think about.
Pretty quiet volume and price action on NYSE for SSN given the spill.
SSN Price at posting:
0.6¢ Sentiment: None Disclosure: Not Held
