Brazil’s largest-ever auction of oil deposits flopped, sending the real tumbling, after state-controlled Petroleo Brasileiro SA did most of the bidding while other major oil companies stayed away.
- Brazilian currency slumps after two blocks sold to Petrobras at the minimu
- two other blocks go unsold; Exxon among companies not bidding
Brazil is not a "short-cycle" story. Shale changed things. When I first started investing, back in 1984, oil companies were "valued" based on two criteria:
- earnings
- reserves
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The Brazilian Story Is Huge
Re-posting: this commentary is linked at the sidebar at the right. It's from the Dallas Fed which, I would think, would know a bit about the oil industry and particularly, the US shale industry. There's a slight flaw in their analysis but that's fine. It should not affect their conclusions.
And their conclusions are summed up in one graphic which I find absolutely amazing. Spend some time on it. Note that the data is biannual -- every two years (2009, 2011, 2013, etc. through 2019).
Tag: breakeven points.
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