John Henry

Why Cheap Oil is Great for the Majors

Satch, I am sure there are good reasons why the BP-TNK relationship broke down but the example was to highlight the approach that is often taken against the large oil companies when high oil prices prevail. Other examples include Venezuela nationalising its oil industry, Bolivia nationalised it's gas industry.

It is natural to maximise your position when in a position of strength, for the last few years the majors have not been in that position but that will change and when it does they will look to negotiate strongly in their favour.

That may just be the start of the cycle again but non the less, a strong negotiating position should be positive for earnings.