BUYING LARGEThank you Seppelt for that post. I was wondering what happend when yesterday volume spiked to almost 1 million shares traded. Last time we had this level of daily trading volume was when PRQ was in the 3 dollar range. And a special thanks to Mr. Gray for his support.
The share price had reached an important level, at least from a technical perspective. It was tettering on the 200(1.78) day moving average, the 40 week MA, as well ,right around 1.82.
Timing is everything, it is said, and this purchase is most timely. Of course, it is not only PRQ that has been hit, the entire sector has taken a beating of late, with continued negative PR, e.g. SPR releases continue unabated, at least until all the sour crude is gone, then what?
The ongoing, very public battle of words between OPEC ministers and Western politicos continues, with OPECs recent statements that the crude pricing is out of whack and not indicative of S/D realities from their perspective, then the cut in production announced of 100,000 bbls/day just a few days back. I suspected that there would be a reaction to this by the paper traders, to try to show who is boss of price, and sure enough, crude/WTI and Brent was drubbed and pushed down through all sorts of technical support levels that the algos thrive on for dumping and smashing stops.
The Saudi prince, speaking for OPEC+ made it clear this past Monday, that the cartel was poised to further cut production without warning, should pricing of crude become a punching bag for paper traders. Notwithstanding the recession fears, China covid lockdowns, continued and apparently non-ending conflict in Ukraine, Gazprom shut off of EU gas deliveries, imminent collapse of EU major nations economies absent access to sufficient crude and NG to meet demands for citizens, much less industry, the pricing has been moved more by paper than fundamentals, IMHO.
So it was that the O+G sector, that has significantly outperformed all other industry groups this year in the markets, took the hit near-term. I expect that pressure on price of crude will continue by various devices until the upcoming election is done. When SPR releases have reached critical limits in residual storage of useable sour crude, there will be a reckoning and this will likely show the market the underlying weakness in supply, absent 7-8 million bbl/week releases up to the election day.
I have read that, at this time of year, budgets for exploration, drilling and all production efforts are being formulated by O+G producers for the next year. Given the increase in pricing for materials, labor shortages and continued, relentless government restrictions for permits, who among the industry will be bullish on spending forward, even as the corporate suites are beseiged by greens and vilified by media as polluters, with the fiction of a green/solar-wind substitution for fossils fuels as a solution to inevitable shortfalls.
I suppose that it will require some real pain in the EU countries going into
Winter before the green fantasy causes citizens to go to the streets, although I see that in some nations they are already protesting this coming debacle, even though it is still very warm in late summer months over there, some folks are aware that economic disaster awaits them.
I hope for the sake of the welfare of the people that they can remove leaders and replace them with rational actors, better hurry up with the change over, it may be already too late for this Winter, but hope for the best and prepare for the worst, like the hoarding of firewood as seen in EU countries now. What a mess!