RE:RE:Lost for Words fellow posters?@ $38 WTI PRE is underwater. If we knew crude would stay this low, the shares are worthless. This is why the price keeps tanking. Those of us with shares are betting on an oil rebound. This is a given considering the supply crunch coming, but when? Will PRE survive to that point? We know they can survive to 2017 assuming oil stays above ~$30WTI.
$1B due in 2017. PRE doesn't need to raise that money through cash flow by then, however. If oil prices hvae rebounded by then, they will surely be able to access credit again and push back the timeline further. So this is the deadline for a rebound. If prices are still anemic by then, the company is toast. The good news is that with $100 oil, this is a $20 stock. High risk, high reward.
The article posted from the G&M claims that we won't see supply decrease any time soon. I think this is flat out false. The world is pumping what they have now, there is little investment in future production. Everyone has gone flat out for the low hanging fruit. This can't last. Furthermore, there is no spare capacity left. Some will claim the Saudis have 2M bbl/d spare capacity. I can't believe this to be true. They are most certainly pumping everything they have at this point. Why would they hold back? That makes no sense at all.
For those asking how supply hasn't fallen yet, you must consider that the world had ~4M bbl/d spare capacity prior to OPECs decision. Over the past year, that production has been unleashed. There is none left. That is a one time thing. Production is about to fall now, in a big way. Well declines amount to about 7M bbl/d per year without new investment. We simply aren't putting the money in to make up for those losses at this point.