RE:RE:RE:RE:RE:How much is COS worth?
COS being worth $2-6 probably factors in an oil price in the $40-50 range for the foreseeable future. If you see that you should sell. I am not selling. But I am not going all in either. My bet is that oil supply will start dropping in Q2 as it takes some time stop the drilling. I am watching the rig count. The last numbers I saw showed that the rig count has been going down but we are still drilling at a rate that increases production. It takes a little bit of time for some to decide that this drop in prices is serious. Also, once money is committed to drill you cannot just stop the process without incurring costs. Also, a lot of these companies borrow money to pay for the drilling and have gotten themselves highly levered. The lenders are now in the position to decide how much more drilling those companies are going to do and my guess is they will be anxious to get the leverage down. By Q3 2015 I expect oil prices to be above break even which is somewhere in the $70-80/bbl range. Bob