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Island_Dweller

Island_Dweller
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  • Is Peabody Energy Finally Facing Oblivion? [View article]
    The author has been right about the decline of coal, however there are assumptions and comparisons being made that are more window-dressing than empirical.

    Businesses can pledge about what they intend to do, but price dictates what they will do. I pledge to buy organic food, but I still end up buying regular groceries sometimes.

    Political statements and intentions are not a reason to discount the importance of coal nor should they be used as a source to determine its direction before they are elected to a higher seat of power.

    China is weak yet India is committed.

    Coal is not the Sony Walkman of the electric power grid. Saying that coal is going to become obsolete implies a biased slant that is fact-less.

    Peabody cannot be compared to Walter energy and to make such a comparison indicates a lack of understanding how Peabody operates.

    Again, the author has been right on coal, but being right and then proclaiming outright destruction of an absolutely crucial industry to cheap power generation is moving away from the facts. We are not witnessing an energy renaissance.
    Jul 29, 2015. 09:29 PM | 10 Likes Like |Link to Comment
  • Peabody Energy Is Challenged But Not Dead [View article]
    Hard to believe it held $1 on heavy-ish volume.
    Jul 29, 2015. 12:49 AM | Likes Like |Link to Comment
  • Oil: Prices Will Rebound [View article]
    2 million barrels is not much wiggle room given global demand is pushing 94 million. That's the reason some are playing this by going long, myself included. 2 million oversupply should not have constituted a more than 50% plunge. People are acting like everything will remain constant, that supply will always outstrip demand, and there won't be any supply disruptions. The dollar is certainly exacerbating the situation, however.

    Asia demand alone is at a record high, over 30 million b/pd and showing no signs of slowing despite constant media attention flapping its arms to a "slow down" in China. World GDP is still expected to grow over 3.3% (it was revised lower from 3.5% but not because of China). Forecasts indicate global demand will increase by just over 1m b/pd through 2017, which I think is low balling demand given cheaper fuel costs working its way to consumer's discretionary income.

    While there is an oversupply in LNG, oil, and coal, it's short sighted to think this will remain constant.

    Everywhere you look there are energy names trading at ridiculous valuations because of narrow perception, because of momentum, and because of herd mentality.
    Jul 27, 2015. 08:42 PM | 4 Likes Like |Link to Comment
  • Peabody Energy Is Challenged But Not Dead [View article]
    Anyone else think BTU will break $1 post earnings?
    Jul 27, 2015. 07:39 PM | 1 Like Like |Link to Comment
  • Oil: Prices Will Rebound [View article]
    Nevermind searching for a bottom, grab some stock on the cheap from companies who's first time at the rodeo this is not and watch the short term spectacle play itself out.

    Thanks for the article.
    Jul 27, 2015. 07:57 AM | 16 Likes Like |Link to Comment
  • Rude Awakening For Those Who Ignored The Energy Markets' Warning Signs [View article]
    Saudi Arabia is targeting the ridiculous amount of investment money thrown at shale drillers that have never generated FCF even when oil was $100. It was a threat of rapid expansion, rapid production, but completely hollow in terms of a sustainable business model.

    The 50% plunge in oil snapped the longest period of high oil prices ever. It was a period of sustained hyper growth and "wildcatters" turned sleepy small towns into bustling hubs. Easy money to expand a business that seemed unstoppable, until recently.

    Oil will continue to be under pressure until the investment cycle is snapped. Perpetuating ever increasing debt levels and chronic negative FCF needs to be corrected. A majority of shale players need to recognize their losses, shut down, and the bigger players need to consolidate.

    Drillers are caught in a bind. They must keep borrowing to pay for exploration needed to offset the steep production declines typical of shale
    wells. On top of this interest expenses are rising and banks are getting impatient. Negative free cash flow and increasing debt spells out one
    word: collapse. U.S. production will fall.

    Someone' going to blink, we just don't know who's going to be the first to do so. It's clear many OPEC partners are hurting, Russia is in a terrible state, and shale drillers are getting desperate.

    One thing is perfectly clear: Oil at this level is not a good thing for a great many producers.
    Jul 27, 2015. 03:00 AM | Likes Like |Link to Comment
  • Oil crash could be worst in at least 45 years, Morgan Stanley warns [View news story]
    Boom and bust cycles. Currently we're in a bust. The environment we're in will not remain constant. Invest accordingly.
    Jul 26, 2015. 07:41 PM | 3 Likes Like |Link to Comment
  • Oil crash could be worst in at least 45 years, Morgan Stanley warns [View news story]
    "Drillers are caught in a bind. They must keep borrowing to pay for exploration needed to offset the steep production declines typical of shale
    wells."

    On top of this interest expenses are rising and banks are getting impatient. Negative free cash flow and increasing debt spells out one
    word: collapse.

    America's dependence on foreign oil is still guzzling to the tune of millions of barrels a day, meanwhile Cushing filled up.
    Jul 26, 2015. 01:51 AM | 3 Likes Like |Link to Comment
  • Oil crash could be worst in at least 45 years, Morgan Stanley warns [View news story]
    Continuing to average down on two of the most heavily shorted names in energy: CHK and RIG.

    Go big or go home.
    Jul 25, 2015. 06:08 PM | 4 Likes Like |Link to Comment
  • Chesapeake's Stock Price Is Suffering From Hard Decisions [View article]
    He has upped his stake from 66m shares in 4Q14 to 73m in 1Q15.

    http://bit.ly/1JCuVGj
    Jul 24, 2015. 08:15 AM | 3 Likes Like |Link to Comment
  • The Current Oil Market Thus Far [View article]
    Typically energy is the best performing sector into late bull market cycles.
    Jul 21, 2015. 11:45 PM | Likes Like |Link to Comment
  • Offshore Vs. Shale - Rig Counts [View article]
    Is there a source stating the amount of world oil production percentage by offshore drillers?
    Jul 21, 2015. 07:22 PM | Likes Like |Link to Comment
  • The Simple Math Behind Transocean [View article]
    After a painful Friday I needed a good laugh, thanks.
    Jul 19, 2015. 07:54 AM | 5 Likes Like |Link to Comment
  • Oil reverses higher following Iran nukes deal [View news story]
    According to the IEA demand will increase to 94 mb/d for full year 2015 -- in 1H15 it hit 93.3 mb/p up 1.6 million on the year.

    4Q15 is expected to hit 95 mb/d.

    Cheaper oil is leading to higher demand and this will continue until the market balances itself after the big selloff at the end of '14 - 1Q15.

    http://bit.ly/1y3sqLu
    Jul 14, 2015. 07:32 PM | 7 Likes Like |Link to Comment
  • Crude oil slides but pares losses after Iran nuclear deal [View news story]
    At least initially so much for a plunge into the $40s after a deal was announced.

    Sell the rumor, buy the news?
    Jul 14, 2015. 08:37 AM | 9 Likes Like |Link to Comment
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534 Comments
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