this is the time of day when I read robert's posts, tally up the "oopsies" and correct them for posterity.
Just a week ago Robert was vociferous in his belief that OIL was going to average $80 USD WTI next year. That was central to his Forecast for Paramount Resources. he also said Natty was "too high" and headed lower. But the opposite happened. Gas is still headed higher and oil has started to head south. So there's THAT.
But I pushed back and said that before we hit $80 wti POU would begin to HEDGE their oil exposure. Because POU is a "hedger. I said they ALWAYS forward hedge to protect cash flows. Robert was Adamant that POU wouldn't forward hedge their oil because "they never do"...
So I imagine my surprise when today Robert is here "crowing" about POU's new 2022 oil hedges at $87 USD WTI. And he's very happy they could get that price. Well it is certainly surprising, but not a total shocker, that Robert would perform a "180" so quickly about the hedging, That's classic bull board behaviour after all.
But I must offer up yet another correction of one of his "facts". You see Robert doesn't fully understand that it was IMPOSSIBLE to hedge oil at $87 USD over the last few weeks when POU put the hedges on. As such it had to be impossible for POU to do it.
Below is what Robert said about POU's hedging. I want to remind you that last week he spilled many a word arguing POU doesn't forward hedge oil. And that POU was going to get $80 USD per BOE in 2020. So that's a big change in just a week for him.
"Results were neutral. Oil/condy down slightly nothing crazy. 6k boes of oil hedged at $87 Usd for next year is excellent. I can see another 6k being added before the year is out perhaps in the $70 to $75 range which would yield us an avg hedged oil price ~ $75 to $80. That would be solid."
Now let's look at what POU actually DID.
Oil – NYMEX WTI Swaps (Sale) 6,000 Bbl/d CDN$88.45/Bbl October 2021 – December 2021 Oil – NYMEX WTI Swaps (Sale) 6,000 Bbl/d CDN$85.88/Bbl January 2022 – March 2022
Notice that their hedge was in CDN and not USD. At current exchange rates their hedge is at $69 and change USD WTI.
I said POU would start hedging WELL BEFORE prices hit $80 USD. Robert was shouting at me that I was wrong.
Robert was wrong on two big things. He was wrong in predicting that POU would not hedge their oil. And when they did hedge he was wrong about the price they got for their hedge. POU seems pleased as punch to be able to hedge some oil UNDER $70 USD.
I guess the lesson here is to read what Robert has to say, when he is brief in what he writes, but be careful and circumspect when he presents data as Facts. He's a very opinionated guy, which is fine. If they are sensible and well thought out.
I guess the old adage applies here. Buyer beware. Even if what they are sellin is "free"...