Long Run Explor Ltd Ord WFREF

RE:phrases of stock market phases

[JonCom]

Realistically, it all depends on how quickly and to what extent the oil producers scale back production. THere have been mass layoffs in the oil sector. When the supply falls below demand, the price will spike and the companies will respond by drilling more oil. However, with the layoffs it wont be as easy to ramp up supply so there will be a slight lag. 

Its hard to say where we are now. I think there is room for oil to fall further, however it seems like it's hit a sticking point at 49-53 bucks. If it falls more in the short term, i think that will lead to a larger rebound.

If it hovers where it is now, eventually suppliers will ramp down once hedges start to run out, id say about April/May of this year. I see demand picking up in the summer and I see the price of oil starting to make its way on a bull run by 3rd or 4th quarter this year.

Thats where we are with oil. Its hard to say how the price of oil will cause this stock to react. By in large we should follow the bull run of oil up, but it is also up to the CEO and managers of LRE to play it safe and try to cut back on the debt as much as possible. They should take advantage of the oil recovery to take as large a chunk out of their debt as possible and try to lean up and run as efficiently as they can. If they can do this early on, they can profity from it much more down the road and be better poised should we have a reapeat of what has happened in the last year with oil prices.

Responsible choices mean not reinstating a dividend when oil hits 60/70 dollars a barrel like the CEO suggested. Keep the dividend off for the first few years and use that additional cashflow to pay down debt. The only reason i see them reinstating the dividend is for tax purposes.

Long story short, we are going to see more growth around 1Q 2016 than we will throught this year. I do think  there is a good chance to double/triple/quadruple your SP from present values but that will be a ways off.