>.Badger/Cara would greatly appreciate your thoughtsYou dare to...

>.Badger/Cara would greatly appreciate your thoughts

You dare to call on the four legged and sharp teethed one? Did you bring the sacrificial red wine, needed for the conjuring? Well it's Friday, I brought my own. So cheers and have a good weekend.


So, Macro: The story so far.

The Europeans sanctioned the Russia federation assets and made their EU fiat reserves worthless. The Russians will never accept USD or Euros for their product again. Once bitten twice shy.

I have to ask, did we expect the Russians to sell their future energy, food and materials for free? moving forward? Effectively the EU has been shut out of the low cost Russian production market. Russia being the largest country in the world, by land mass. Good news for BYE as it helps the price of US western gas. Bad news for the EU as it means industry will have to have to move to the Americas. The land of cheap energy. After all a company in Mexico can access cheap labour (third cheaper than China), cheap piped shale gas, with a rich consumer market market in the US. So, Why would an entrepreneur build a new factory in the EU? I hope to be proved wrong on this point. After all they are a clever lot, and Badger might have missed something.

Russia, with a break even price of $USD40 for oil, was a major force keeping the price of oil down in past western markets. They are now looking to transition to sell oil to the Indian markets (1.4 billion people), China market (1.4 billion people). Entertainingly these markets then sell this heavy oil on via arbitrage. (Hence high recent diesel prices? )

I read an article that was explaining that KSA was buying Russian oil to run their local economy and selling their domestic oil, that this freed up, onto the western markets. Are they exporting Russian oil? No. Are they breaking sanctions ? No. Does Russia benefit? yes.

Summary: The price of oil will remain high in USD terms as Russia sells to the developing world or is shut in.


So, Micro:

In my view BYE share price seems to based on adventurers. Gamblers, maybe a less charitable way of saying this. That is, I don't see aunt Betty or the "men in grey" from accounts thinking about buying BYE shares. And right now the black jack table is clear and it's all BAU. Profitable BAU, with oil prices sticking above $70+. But nothing to bet on. This will all change in March then the next 3 drills are scheduled. So I expect a decline and then an up tick in February.

All disclaimers. Especially if you did not bring the required bottle of red needed for the conjuring. Have a great weekend.