Archive for Energy – Page 7

05 Dec

Investors urged to be vigilant to possibility of surging oil prices

By George Prior 

Oil prices are increasingly likely to rise towards the end of the year and into 2024, which could hit your investment portfolio, warns the CEO of one of the world’s largest independent financial advisory, asset management and fintech organizations.

deVere Group’s chief executive, Nigel Green, is speaking out after Saudi Arabia says that oil production cuts can “absolutely” continue past the first quarter of 2024 if necessary, and amid growing tensions in the Red Sea.

He comments: “The OPEC+ reductions to oil production announced last week of more than 2 million barrels a day – half of which come from Saudi Arabi – could run past the first quarter, according to the country’s Energy Minister.

“Although the cuts have had little impact on prices so far, it could be reasonably expected that as the cuts continue, they will begin to fuel price rises – especially as there’s no obvious sign that the Saudis are in a rush to remove the reductions to the oil they send to the rest of the world.”

The deVere CEO continues: “Another factor is the potential disruption to oil supplies, with reports saying that attacks on commercial shipping routes in the Red Sea are on the rise.

“The oil market has to date seemingly brushed off the increasing fears of soaring disruption, but the Red Sea is critical – all oil from the Middle East to Europe goes through it – and there are heightening issues in the region.”

The Pentagon on Sunday said a US warship and three commercial vessels had come under attack off the coast of Yemen.

This is driving concerns that Houthi rebels and their backers in Iran were intensifying their agenda as a result of the war in Gaza.

As a critical component of industrial production, transportation, and energy generation, oil plays a pivotal role in shaping global financial markets.

“Rising oil prices often lead to increased production costs across various industries. As businesses face higher expenses for transportation and raw materials, these costs are frequently passed on to consumers, contributing to inflationary pressures,” notes Nigel Green.

“Also, oil is priced in US dollars, and as oil prices rise, countries that are net importers of oil experience an increase in their trade deficits.

“This can lead to depreciation in the value of their currencies, affecting foreign exchange markets. Investors holding assets denominated in these currencies could experience declines in the value of their portfolios.

“Companies operating in energy-intensive sectors, such as transportation, manufacturing, and agriculture, may witness a decline in profitability as input costs rise. This, in turn, affects corporate earnings and can lead to changes in stock prices.”

He concludes: “We see a growing likelihood for oil prices to rise over the next six months due to the possibility of the extension of production cuts and increasing geopolitical tensions.

“The intricate relationship between oil and global financial markets underscores the need for investors to stay vigilant and possibly adapt their strategies and portfolios accordingly.”

About:

deVere Group is one of the world’s largest independent advisors of specialist global financial solutions to international, local mass affluent, and high-net-worth clients.  It has a network of more than 70 offices across the world, over 80,000 clients and $12bn under advisement.

Energy Opinions
04 Dec

Brent “does not believe” OPEC+

By RoboForex Analytical Department

Brent oil prices fell to 78.30 USD per barrel on Monday.

Despite OPEC+ decisions at the November meeting, oil prices are falling. The issue is that the actual parameters of OPEC+ quotas turned out to be lower than investors expected. This does not cancel out the Cartel’s powerful support on prices. However, the market cannot cope with emotional reactions.

Escalating tensions in the Middle East observed last weekend may bolster the oil quotes. The factor of a strong US dollar is working oppositely. While the USD is rising, commodity assets appear less attractive to buyers.

Brent technical analysis

On the H4 Brent chart, there was a rebound from the 84.81 level. The market has fallen to 80.10 and is forming a consolidation range around this level today. A decline to 78.10 is expected, followed by a rise to 80.00 (a test from below). Subsequently, the price could continue its downward trajectory to 76.50. A growth wave might start after the price reaches this level, targeting 85.80. This is the first target for the growth wave. Technically, this scenario is confirmed by the MACD, with its signal line breaking the zero mark, aimed strictly downwards.

On the H1 Brent chart, a consolidation range has expanded downwards to 78.10. Today, a rise to 80.10 is expected, followed by a drop to 76.50, potentially continuing to 75.40. Technically, this scenario is confirmed by the Stochastic oscillator, with its signal line below 20 and poised to rise to the 50 mark.

Disclaimer

Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.

Energy Financial News
30 Nov

Why the Fed should treat climate change’s $150B economic toll like other national crises it’s helped fight

By Jennie C. Stephens, Northeastern University and Martin Sokol, Trinity College Dublin 

Climate disasters are now costing the United States US$150 billion per year, and the economic harm is rising.

The real estate market has been disrupted, as home insurance rates skyrocket as wildfire and flood risks rise with the warming climate. Food prices have gone up with disruptions in agriculture. Health care costs have increased as heat takes a toll. Marginalized and already vulnerable communities that are least financially equipped to recover are being hit the hardest.

Despite this growing source of economic volatility, the Federal Reserve – the U.S. central bank that is charged with maintaining economic stability – is not considering the instability of climate change in its monetary policy.

Earlier this year, Fed Chair Jerome Powell declared unequivocally: “We are not, and we will not become, a climate policymaker.”

Powell’s rationale is that to maintain the Fed’s independence from politics and political cycles, it should use its tools narrowly to focus on its core mission of economic stability. That includes price stability, meaning keeping inflation low and maximizing employment. In Powell’s view, the Fed should stay away from social and environmental concerns that are not tightly linked to its statutory goals.

However, it is getting increasingly difficult for central banks to ensure stability if they do not integrate climate instability into their monetary policies.

As researchers with expertise in climate justice and central banks, we recently published a paper reviewing the monetary policy tools available to central banks around the world that could help slow climate change and reduce climate vulnerabilities.

With the new U.S. National Climate Assessment and other research making clear that U.S. policies and actions are insufficient to minimize climate instability and manage the growing economic costs, we believe it’s time to reconsider the role of central banks in responding to the climate crisis.

Rethinking interest rates

One thing central banks could do is set lower interest rates for renewable energy development. The Bank of Japan has used this strategy.

The Fed’s aggressive increases in interest rates in response to rising inflation have slowed the transformation toward a more sustainable society by supporting fossil fuels and making investments in renewable energy infrastructure more expensive. Offshore wind power has been particularly hard hit, with multiple multibillion-dollar projects canceled as higher interest rates raised the projects’ costs.

One way to introduce differentiated rates would be to create a special lending facility under which commercial banks could borrow money from the central bank at preferential interest rates if used for renewable energy deployment or other climate-friendly investments. Whether the Fed already has authorization to do that depends on interpretation of its current mandate.

While the U.S. Federal Reserve has not done it before, China’s central bank has used similar tools to incentivize renewable energy, and the Bank of Japan’s lending facility offers zero-interest loans for green investments.

Nudging banks to rethink investments

Despite the Fed’s proclaimed efforts not to pick winners and losers, its monetary policies have taken steps that favor established industries and companies, including the fossil fuel industry.

For example, the Fed supported the financial sector unconditionally during the COVID-19 pandemic to keep credit available to limit economic harm. Its massive purchases of corporate bonds resulted in subsidies to the fossil fuel sector.

Our analysis suggests two ways to help manage climate change now: The Fed can reinterpret its current statutory duties and start viewing climate action as a critical part of its role in maintaining economic stability within its existing mandate, as the European Central Bank has done, or the mandate of the Fed can be changed by Congress to explicitly include “green” transformation objectives, similar to the U.K.‘s mandate for the Bank of England.

Either of these options could empower the Fed to address climate change and support the government, businesses, banks, households and communities in financing climate mitigation and adaptation efforts.

Two maps showing extreme heat days rising almost everywhere and extreme precipitation increasingly common, particularly in the Eastern U.S.
Rising temperatures exacerbate climate risks, including droughts, wildfires and extreme storms. Global temperatures have already warmed by more than 1 degree Celsius (1.8 Fahrenheit) compared to preindustrial times. The projected changes with 2 C (3.6 F) of warming, which the world is on pace to exceed this century, are relative to the 1991-2020 average.
Fifth National Climate Assessment

The Fed could also discourage banks and investors from investing in assets that ultimately harm the economy – for instance, by setting collateral requirements for banks that would reduce the attractiveness of holding carbon-intensive assets. The European Central Bank recently announced that it would tilt purchases of corporate bonds toward “green” assets.

The Fed has recently taken steps to push large financial institutions to monitor climate-related risks in their portfolios, drawing the ire of Republicans, who claimed the bank had no authority to consider climate change. Whether this risk management approach will pressure banks to change their lending patterns is not yet clear.

The Fed and other central banks could go further and mandate energy transition planning with an eye toward economic stability. The European Union developed a whole new sustainable finance framework designed to discourage investment in economic activities that do not support an energy transition along the lines of the European Green Deal, which aims to turn Europe into a climate-neutral continent with no one left behind. The European Central Bank is obligated to support EU economic policies, including the green transition.

The Fed has used creative tools before

Many times in its 110-year history, the Fed has provided financial support to the U.S. government during major crises, such as wars and recessions, by offering direct lines of credit or by directly purchasing Treasury bonds. During the pandemic, it took extraordinary steps to keep U.S. businesses running.

Now that the U.S. is facing rising costs from the climate crisis, we believe the Fed should treat climate change with the same urgency and importance.

In our analysis of the tools available to central banks, we took a climate justice perspective, looking beyond greenhouse gas emission reductions to incorporate social justice and economic equity. Instead of focusing on supporting corporate interests and the financial sector in the short term to stabilize markets, we believe central banks could prioritize longer-term stability by funneling investments toward vulnerable communities and people.

The Bank of England, the European Central Bank and other central banks are already implementing some pro-climate measures. At the Fed, Powell seems more concerned with political backlash than the economic damage to the U.S. economy outlined in the latest climate assessment.

We believe it is past time that the Fed consider climate destabilization as a major economic crisis and use more of the tools in the central bank toolbox to tackle it.The Conversation

About the Author:

Jennie C. Stephens, Dean’s Professor of Sustainability Science & Policy, Northeastern University and Martin Sokol, Associate Professor of Economic Geography, Trinity College Dublin

This article is republished from The Conversation under a Creative Commons license. Read the original article.

 

Energy Opinions
30 Nov

Brent advances ahead of OPEC+ decision

By JustMarkets

  • Brent enters squeeze ahead of OPEC+ decision
  • Will cartel deliver or disappoint?
  • Supply cuts from OPEC+ could trigger 400-point rally
  • Brent in ascending triangle and above 21-day SMA

Oil extended gains on Thursday as market focus shifted towards the OPEC+ meeting that was postponed from last week due to internal disagreements.

Brent prices punched above $83 this morning after jumping almost 4% over the last two sessions after a severe storm in the Black Sea region sparked supply concerns. While this development has kept oil prices buoyed, the looming virtual OPEC+ meeting today is likely to influence the global commodity’s outlook.

Given the sharp selloff in oil prices since mid-September, OPEC+ could make further changes to an agreement that already limits supply into 2024. Indeed, oil has been hammered by concerns about weaker economic growth and expectations of a supply surplus in 2024. However, discord over output quotas for African oil-producing countries could act as an obstacle that leads to further delays in negotiations.

  • Oil prices may weaken if the cartel fails to reach an agreement on production quotas for 2024 or disappoint market expectations for deeper supply cuts.
  • Should OPEC+ move ahead with deeper supply cuts, this could lend oil bulls fresh support – pushing the global commodity higher as a result.

Technically speaking...

Since the November 16th low at $77.08, the black gold has rallied within an ascending triangle for over 600 points and as of the time of writing sits above its 21-day SMA at around $83.

According to Thomas Bulkowski in his book “Encyclopedia of Chart Patterns”, ascending triangles perform better with upward breakouts, with a 70% chance of meeting their breakout target, and a 17% breakeven failure rate. 

Brent bulls may take any deeper production cuts as bullish and rally to the following key resistance levels.

•            $83.66: the 261.8 Fibonacci level

•            Its 50-day SMA

•            $88: A significant price level

The Fibonacci level is drawn from the September 26 low to the September 28 high on a daily time frame.

However, if widely reported disagreements over these quotas continue, we could see brent oil prices fall to test the following support levels.

•            $81.67: the 61.8 Fibonacci level

•            $81.00: the rising trend line capturing lows from November 16th.

•            $75.47: the 423.6 Fibonacci level

By JustMarkets

 

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

Energy Financial News
24 Nov

Oil Producer Adds Reserves and Exploration Upside Across Africa

Source: Stephane Foucaud  (11/17/23)

Stephane Foucaud at Auctus Advisors sees over 90% upside for Panoro Energy based on increased reserves, new exploration potential, and improving fundamentals.

Norway-based Panoro Energy ASA (PEN:OSE; 1PZ:FRA) provided an operational update highlighting increased reserves and new exploration upside across its African oil assets, noted Auctus Advisors in a November 17 research report.

Analyst Stephane Foucaud reiterated a Buy rating and NOK$50 price target on Panoro Energy.

Expanded Resource Estimates in Gabon

According to Foucaud, the operator of Panoro’s Dussafu permit offshore Gabon now estimates 10 million barrels of oil in place above initial expectations, adding 4-5 million barrels of recoverable resources.

This is in addition to the recent 6-7 million barrel discovery at Hibiscus South, both driving increased reserve potential.

New Exploration Prospects Identified

Panoro also plans to drill the 29 million barrel Bourdon exploration prospect on the Dussafu permit. The company sees further upside at its Ceiba field in Equatorial Guinea and added the Akeng Deep prospect.

The analyst believes these opportunities, along with expanded reserves, support his unchanged valuation.

Production Impacted by Temporary Issues

While Panoro produced 10,000 barrels per day in Q3, exceeding estimates, short-term electrical submersible pump (ESP) problems temporarily impacted the Dussafu wells.

This will defer some production to late 2023 and early 2024 before new wells boost output.

Significant Upside Based on Improving Fundamentals

Auctus’ NOK$50 price target implies over 90% upside potential for Panoro Energy. The firm’s valuation is based on increasing reserves, new exploration prospects, and attractive EV/DACF multiples.

In summary, the analyst sees the company’s expanded resources and lower leverage supporting significant share price appreciation.

 

Important Disclosures:

  1. The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.

For additional disclosures, please click here.

Disclosures for Auctus Advisors, Panoro Energy ASA, November 17, 2023

Panoro Energy ASA (“Panoro” or the “Company”) is a corporate client of Auctus Advisors LLP (“Auctus”). Auctus receives, and has received in the past 12 months, compensation for providing corporate broking and/or investment banking services to the Company, including the publication and dissemination of marketing material from time to time.

MiFID II Disclosures This document, being paid for by a corporate issuer, is believed by Auctus to be an ‘acceptable minor non-monetary benefit’ as set out in Article 12 (3) of the Commission Delegated Act C(2016) 2031 which is part of UK law by virtue of the European Union (Withdrawal) Act 2018. It is produced solely in support of our corporate broking and corporate finance business. Auctus does not offer a secondary execution service in the UK. This note is a marketing communication and NOT independent research. As such, it has not been prepared in accordance with legal requirements designed to promote the independence of investment research and this note is NOT subject to the prohibition on dealing ahead of the dissemination of investment research.

Author The research analyst who prepared this research report was Stephane Foucaud, a partner of Auctus.

Not an offer to buy or sell Under no circumstances is this note to be construed to be an offer to buy or sell or deal in any security and/or derivative instruments. It is not an initiation or an inducement to engage in investment activity under section 21 of the Financial Services and Markets Act 2000.

Note prepared in good faith and in reliance on publicly available information Comments made in this note have been arrived at in good faith and are based, at least in part, on current public information that Auctus considers reliable, but which it does not represent to be accurate or complete, and it should not be relied on as such. The information, opinions, forecasts and estimates contained in this document are current as of the date of this document and are subject to change without prior notification. No representation or warranty either actual or implied is made as to the accuracy, precision, completeness or correctness of the statements, opinions and judgements contained in this document.

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Disclaimer This note has been forwarded to you solely for information purposes only and should not be considered as an offer or solicitation of an offer to sell, buy or subscribe to any securities or any derivative instrument or any other rights pertaining thereto (“financial instruments”). This note is intended for use by professional and business investors only. This note may not be reproduced without the prior written consent of Auctus. The information and opinions expressed in this note have been compiled from sources believed to be reliable but, neither Auctus, nor any of its partners, officers, or employees accept liability from any loss arising from the use hereof or makes any representations as to its accuracy and completeness. Any opinions, forecasts or estimates herein constitute a judgement as at the date of this note. There can be no assurance that future results or events will be consistent with any such opinions, forecasts or estimates. Past performance should not be taken as an indication or guarantee of future performance, and no representation or warranty, express or implied is made regarding future performance. This information is subject to change without notice, its accuracy is not guaranteed, it may be incomplete or condensed and it may not contain all material information concerning the company and its subsidiaries. Auctus is not agreeing to nor is it required to update the opinions, forecasts or estimates contained herein. The value of any securities or financial instruments mentioned in this note can fall as well as rise. Foreign currency denominated securities and financial instruments are subject to fluctuations in exchange rates that may have a positive or adverse effect on the value, price or income of such securities or financial instruments. Certain transactions, including those involving futures, options and other derivative instruments, can give rise to substantial risk and are not suitable for all investors. This note does not have regard to the specific instrument objectives, financial situation and the particular needs of any specific person who may receive this note. Auctus (or its partners, officers or employees) may, to the extent permitted by law, own or have a position in the securities or financial instruments (including derivative instruments or any other rights pertaining thereto) of the Company or any related or other company referred to herein, and may add to or dispose of any such position or may make a market or act as principle in any transaction in such securities or financial instruments. Partners of Auctus may also be directors of the Company or any other of the companies mentioned in this note. Auctus may, from time to time, provide or solicit investment banking or other financial services to, for or from the Company or any other company referred to herein. Auctus (or its partners, officers or employees) may, to the extent permitted by law, act upon or use the information or opinions presented herein, or research or analysis on which they are based prior to the material being published.

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Energy Financial News
20 Nov

Brent has risen with support from an OPEC+ decision

By RoboForex Analytical Department

The price of a Brent barrel climbed to 81.20 USD on Monday.

The market primarily relies on OPEC+ member countries reducing crude oil supply to control prices. Energy carrier prices have declined for four consecutive weeks due to diminishing concerns about supply disruptions related to the Middle East conflict.

An OPEC+ meeting is scheduled for 26 November. The possibility of discussing additional supply cuts may arise.

Since the end of September, crude oil prices have dropped by nearly 20%.

Technical analysis of Brent oil:

On the H4 Brent chart, a growth wave is forming to 82.72. A correction to 79.70 might follow, after which a new growth wave to 86.85 could initiate. This is a local target. Technically, this scenario is confirmed by the MACD, with its signal line below zero, strictly pointing upwards.

On the H1 Brent chart, the growth wave movement to 82.72 is complete. This represents the first target. After the price reaches this level, a correction to 79.70 is expected to start, and a rise to 83.25 is expected next. Breaking through this level may unlock the potential for climbing to 86.85. This is a local target. Technically, this scenario is confirmed by the Stochastic oscillator, with its signal line above 80, strictly pointing upwards. New highs are expected to be set in this scenario.

Disclaimer

Any predictions contained herein are based on the author’s particular opinion. This analysis shall not be treated as trading advice. RoboForex shall not be held liable for the results of the trades arising from relying upon trading recommendations and reviews contained herein.

Energy Financial News
17 Nov

Hydrogen Firm Craters Over Liquidity Concerns

Source: Streetwise Reports  (11/16/23)

Many people consider hydrogen an important part of the emerging green economy. However, one major player in the field for the past 20 years is facing new and growing issues.

Plug Power Inc. (PLUG:NASDAQ) has spent the past two decades trying to position itself as a provider of turnkey hydrogen fuel cell turnkey solutions. It provides electrolyzers that allow industrial refueling stations to generate hydrogen on-site for use as a fuel.

Plug Power focuses on using this fuel for industrial mobility applications, including electric forklifts and electric industrial vehicles, as well as stationary power systems that support critical operations, such as data centers, microgrids, and generation facilities.

Its technologies are designed to be used in both backup power and continuous power roles, with the ultimate goal of replacing batteries, diesel generators, and the grid for telecommunication logistics, transportation, and utility customers.

The company’s products include GenDrive, GenFuel, GenCare, GenSure, GenKey, ProGen, Electrolyzers, Liquefaction Systems and Cryogenic Equipment. It serves the North American and European material handling markets. It is based in Latham, New York.

 Collapsing Share Price, Market Confidence

On November 13, Investing.com reported that “Plug Power shares slipped in premarket U.S. trading, extending a steep loss posted on Friday, after Morgan Stanley slashed its share price target of the hydrogen fuel cell system developer in the wake of a going concern warning.”

Morgan Stanley lowered its price target for Plug Power from US$9.00 to US$3.50, explaining that it expects “valuation pressure will remain until the company, at a minimum, improves its liquidity position.”

“[We] believe the next three to four months will be consequential in rebuilding investor confidence in the business model,” Morgan Stanley analysts wrote.

Morgan Stanley lowered its price target for Plug Power from US$9.00 to US$3.50, explaining that it expects “valuation pressure will remain until the company, at a minimum, improves its liquidity position.”

This considerable valuation downgrade comes after Plug Power raised doubts about its own viability last week. In a regulatory filing, the company estimated that its “existing cash and available for sale and equity securities will not be sufficient to fund its operations” over a 12-month horizon.

Quite simply, the company was expressing that it would need to secure additional capital in order to stay in business, a concern that the Morgan Stanley analysts echoed. Plug Power claims it is facing a “historically difficult” hydrogen supply environment, especially in North America, where it is facing “multiple frequent force majeure events.”

Shares in the company lost more than 40% of their value on Friday, and the company as a whole has lost over half of its market capitalization since the start of the year.

Hydrogen Hype Hides Inefficiencies

Hydrogen as a fuel has a long and storied history, but the tech and associated supply lines have never really matured in a manner capable of causing a green revolution. In fact, over two years ago, Forbes was already asking, “Why Are We Still Talking About Hydrogen?” In that insightful piece, James Morris examined the many impediments to widespread hydrogen adoption.

Chief among these is that “It can’t seem to escape how massively inefficient it is compared to battery-powered alternatives.”

“The flaw is basically caused by the laws of physics,” Morris explains. “For hydrogen to be completely green, it must be produced by electrolyzing water, which splits this into the H2 and O that it is made of.

New Constructs credit rating issued a suspended neutral rating for Plug Power on November 11, classing the company’s Adjusted Debt to Capital and Adjusted Cash to Debt ratios as “Very Attractive” while listing the Adjusted EBITDA to Debt and Adjusted FCF (3yr avg) to Debt ratios, as well as the Adjusted Interest Coverage, as “Very Unattractive.”

You can produce H2 from fossil fuels (usually methane), but this creates either “gray” hydrogen (which still produces lots of CO2) or “blue” hydrogen (which captures 90% of the CO2 and stores it, merely delaying the problem). Only electrolyzing hydrogen from water using electricity generated from renewable sources makes the fuel entirely green.”

“This is an inefficient system that wastes energy,” Morris continues. “According to a frequently cited study by Transport & Environment, the process of electrolyzing hydrogen already loses 30% of the energy from the process of splitting the H2 from the O. You then have another 26% loss of the remaining energy from transporting the hydrogen to the fuel station, meaning you’ve already lost a total of 48% of the energy before any hydrogen makes it into a vehicle.”

“You can save some of this by making hydrogen on-site,” — which is the model Plug Power is attempting to develop — “but electrolysis plants cost millions, so they will more likely be centralized.

In comparison, the typical loss from transferring electricity over wires to a charging station is just 5%, so you still have 95% left.”

Non-Automotive Solutions

Now, there’s a valid argument that Plug Power isn’t competing in the automotive market but rather in the industrial space. However, as electric vehicle technology grows in popularity, we will inevitably see spillover into industrial uses, such as forklift operation, further squeezing the market for on-site industrial solutions.

In addition, poor efficiency is only one of the concerns associated with the increased use of hydrogen fuel in industrial settings. Writing for Issues in Science and Technology, Joseph J. Romm explains that “hydrogen has its own major safety issues. It is highly flammable, with an ignition energy that is 20 times smaller than that of natural gas or gasoline. It can be ignited by cell phones or by electrical storms located miles away.”

“Hence,” he writes, “leaks pose a significant fire hazard, particularly because they are hard to detect. Hydrogen is odorless, and the addition of common odorants such as sulfur is impractical, in part because they poison fuel cells. Hydrogen burns nearly invisibly, and people have unwittingly stepped into hydrogen flames.”

“Hydrogen can cause many metals, including the carbon steel widely used in gas pipelines, to become brittle. In addition, any high-pressure storage tank presents a risk of rupture. For these reasons, hydrogen is subject to strict and cumbersome codes and standards, especially when used in an enclosed space where a leak might create a growing gas bubble.”

These strict use codes further hamper the industry’s ability to endorse and onboard hydrogen solutions, even where they would otherwise be a decent fit.

“Some 22% or more of hydrogen accidents are caused by undetected hydrogen leaks,” Romm reports.

Such leaks occur “despite the special training, standard operating procedures, protective clothing, electronic flame gas detectors provided to the limited number of hydrogen workers,” writes Russell Moy, former group leader for energy storage programs at Ford, in the November 2003 Energy Law Journal, concluding that “with this track record, it is difficult to imagine how hydrogen risks can be managed acceptably by the general public when wide-scale deployment of the safety precautions would be costly and public compliance impossible to ensure.”

Why Now? Massive Discount

Given the realities of the hydrogen market and the considerable barriers to its growth mentioned above, it might be easy to give up on Plug Power. Clearly, many former shareholders have already made that determination.

That said, where some see crisis, others see opportunity. If you’ve been looking for an undervalued pathway into the hydrogen market in particular — perhaps as a hedge against electric vehicles or even fossil fuels — this massive writedown could be just the goad you need to pick up a position after someone else has eaten a major loss.

However, if you choose to play in these waters, remember that volatility is the name of the game. Third-party advisors seem more unsure of what to do with Plug Power than any stock in recent memory.

Streetwise Ownership Overview*

Plug Power Inc. (PLUG:NASDAQ)

Institutions: 56.95%
Retail: 33.08%
Strategic Investors: 9.08%
Management & Insiders: 0.89%
57.0%
33.1%
9.1%
*Share Structure as of 11/16/2023
Source: Thomson Reuters

 

For example, New Constructs credit rating issued a suspended neutral rating for Plug Power on November 11, classing the company’s Adjusted Debt to Capital and Adjusted Cash to Debt ratios as “Very Attractive” while listing the Adjusted EBITDA to Debt and Adjusted FCF (3yr avg) to Debt ratios, as well as the Adjusted Interest Coverage, as “Very Unattractive.”

Ownership and Share Structure

According to Reuters, 0.89% of the company is owned by management and insiders. Out of this group, Director and Chairman of the Board George McNamee has the most at 0.15%, with 0.94 million shares.

9.08% is with one strategic investor, SK Inc., which owns 9.08%, at 54.97 million shares.

56.95% is held by institutions. Top investors in this category include The Vangaurd Group Inc. at 8.85%, with 53.60 million shares, and BlackRock Institutional Trust Company N.A. at 4.98%, with 30.16 million.

The rest is with retail investors.

Plug Power Inc. has a market cap of  US$2.13 billion with 605.5 million shares outstanding.

 

Important Disclosures:

  1. Owen Ferguson wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor.
  2. The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.

For additional disclosures, please click here.

Energy Financial News
17 Nov

Week Ahead: More pain ahead for oil?

By ForexTime 

  • Oil tumbles into bear market on demand fears
  • Keep eye on incoming EIA report and US data
  • Oil slump throws OPEC+ into spotlight
  • Bears in power but RSI oversold
  • Key levels of interest at $75.30, $72.50 and $70

Despite the holiday-shortened week ahead in the United States, financial markets could see some action thanks to top-tier economic releases across the globe.

Monday, 20th November   

  • CNH: China loan prime rates
  • GBP: Bank of England Governor Andrew Bailey
  • USD: Conference Board leading index

Tuesday, 21st November 

  • CAD: Canada CPI
  • EUR: Eurozone new car registrations
  • NZD: New Zealand trade
  • USD: US FOMC minutes, existing home sales
  • NQ100_m: Nvidia earnings

Wednesday, 22nd November

  • EUR: Eurozone consumer confidence
  • GBP: UK government’s Autumn Statement
  • USD: US initial jobless claims, University of Michigan consumer sentiment

Thursday, 23rd November  

  • EUR: Eurozone/Germany S&P Global PMIs
  • GBP: UK S&P Global /CIPS Manufacturing PMI
  • US Markets closed – Thanksgiving holiday

Friday, 24th November

  • CAD: Canada retail sales
  • EUR: Germany IFO business climate, GDP
  • JPY: Japan CPI
  • USD: S&P Global manufacturing PMI
  • US markets close early – 1:00 pm ET

Sunday, 26th November

  • OPEC+ meeting

Our focus falls on crude oil which has collapsed into a bear market. 

The global commodity is under intense pressure, heading for its fourth straight week of declines.

Note: A bear market happens when an instrument drops by 20% or more from its most recent high.

The pain started mid-week as swelling US inventories fuelled demand-side fears with disappointing economic data from the largest economy in the world exciting oil bears further.

Before the hefty 4.7% selloff this week, oil prices were already being pressured by weak data from China and easing fears over the Israel-Hamas conflict disrupting supply from the region.

With the path of least resistance for oil pointing south, further losses could be on the cards.

Here are 4 key factors that may influence oil in the week ahead:

  1. US Energy Information Agency (EIA) report

It is worth noting that markets received 2 weeks of data from the EIA due to a planned system upgrade.

Crude oil inventories expanded for a fourth week, rising by 3.6 million barrels in the week ended November 10. This was followed by a huge 13.9 million-barrel build in the previous period.

The next EIA report published on Wednesday 22nd November may shape oil’s short to medium-term outlook.

  • Another build in US crude inventories may further darken the demand outlook, dragging the global commodity lower as a result.
  • A decline in US inventories could soothe fears around waning oil demand, potentially limiting downside pressures on crude.

  1. FOMC minutes + US data 

Much has changed since the Federal Reserve policy meeting on the 1st of November with the soft US inflation report extinguishing any remaining bets around the Fed hiking rates.

Nevertheless, the Fed minutes could offer additional insight into what Fed officials thought about the US economic outlook. On the data front, there will be some key economic releases including the US initial jobless claims, university of Michigan consumer sentiment, and manufacturing PMI which could trigger dollar volatility.

  • Should the minutes strike a cautious note and overall US economic data disappoint, this could feed fears around waning demand – dragging oil prices lower.
  • While a positive set of US economic data may quell fears around the demand outlook and supporting oil – a stronger dollar could limit upside gains.

  1. Anticipation ahead of OPEC+ meeting 

Note: the full impacts of what is decided during the OPEC+ meeting will not be reflected until Monday 27th November. However, the growing anticipation could influence oil prices ahead of this major event.

Oil prices are trading at their lowest levels since July ahead of the OPEC+ meeting on Sunday 26th November.

The latest selloff in oil prices has added more focus to the upcoming meeting, opening the doors for greater supply cuts as the cartel continues its quest to rebalance markets. It is worth keeping in mind that OPEC+ has been cutting production since late 2022 with a broader deal to limit supply throughout 2024.

Markets already expect the extension of production cuts by Saudi Arabia and Russia into the early parts of 2024. So, the cartel may need to offer something new to revive oil bulls.

  • Oil prices could be thrown a lifeline if the cartel moves ahead with deeper supply cuts.

  1. Technical forces 

Prices are under intense pressure on the daily charts with crude respecting a bearish channel. There have been consistently lower lows and lower highs while the MACD trades to the downside. However, the Relative Strength Index (RSI) is flirting near 30, indicating that crude may be oversold. While this has the potential to trigger a technical rebound, the scales of power remain in favour of bears.

  • A solid daily close below $74 could send prices back towards $72.50 and $70, respectively.
  • Should prices push back above $75.30, this could open the doors towards the 200-day SMA at $78 and $79.80.

Forex-Time-LogoArticle by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

Energy Opinions
13 Nov

Brent Oil Price is Declining Again

By RoboForex Analytical Department

The commodity market started the week with a new wave of selloffs. The price of a barrel of Brent crude decreased to 80.65 USD.

Investors began reducing long positions on Friday amid uncertainty in the Middle East.

This week, the monthly reports from the International Energy Agency and OPEC are expected to be released. These documents will hold fresh assessments of the situation in the oil sector and, possibly, forecasted supply and demand parameters.

Also, the market eagerly awaits the latest inflation statistics from the US. This is one of the key indicators in shaping the Fed’s monetary policy, which is also significant for the oil market.

Brent technical analysis

On the H4 chart, Brent has completed an upward impulse reaching the level of 81.89. Today, the quotes might correct to 80.37. After the correction is completed, a new wave of growth to 84.00 could begin, from where the trend could continue to 87.87. Technically, this scenario is confirmed by the MACD indicator. Its signal line is below zero and strictly directed upwards.

On the H1 chart, Brent has completed an upward wave to 81.89. Today, a correction to 80.37 is forming. After the price reaches this level, a wave of growth to 81.89 could follow. A breakout of this level could open the potential for a rise to 84.09. This is a local target. Technically, this scenario is confirmed by the Stochastic oscillator: its signal line is below 20 and strictly directed upwards. The indicator is expected to renew the highs.

Disclaimer

Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.

Energy Financial News
09 Nov

My Newest Electrification Play as Demand for Nuclear Surges

Source: Michael Ballanger  (11/6/23)

 As the demand for uranium grows, Michael Ballanger of GGM Advisory Inc. shares one stock he believes is worth looking into.

I have been bullish on uranium since 2017, which means I have seen two rallies, neither of which I traded.

At the start of the year, I came up with the concept of the “Electrification Trilogy,” calling for increases in demand for new sources of electricity (nuclear/uranium), transmission infrastructure (wiring/copper), and electrical storage (batteries/lithium) and while I maintained exposure to copper and lithium, I really only had a small position in one uranium developer forgetting all the while that the best proxy for uranium has to be Cameco Corp. (CCO:TSX; CCJ:NYSE).

While I find it difficult to own any stock after it has nearly doubled, I listened to the conference call this week after they reported blow-out earnings, and what grabbed me by the throat was the forward guidance in which they said: “We are seeing durable, full-cycle demand growth across the nuclear energy industry.”

That is really positive guidance, and with 57 new reactors currently under construction around the globe and with Germany reversing their decision to dismantle three of their power plants, the demand for uranium is going to kick in long before new supply can hit the market.

Accordingly, I decided to bite the bullet and take a punt on a few Cameco March US$40 calls in the US$5.00 range on the assumption that I will see all-time highs above US$46.41 by New Year’s Day and US$50 in Q1/2024.

I know I am late to the party, but with guidance so powerfully bullish and nuclear the only real solution to the global energy problem, I cannot see getting hurt despite the modest overbought conditions it moved into on Friday before backing off.

Important Disclosures:

  1. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Cameco Corp.
  2. Michael Ballanger: I, or members of my immediate household or family, own securities of: Cameco Corp. My company has a financial relationship with: Cameco Corp. I determined which companies would be included in this article based on my research and understanding of the sector.
  3. Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy.
  4.  This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company.

For additional disclosures, please click here.

Michael Ballanger Disclosures

This letter makes no guarantee or warranty on the accuracy or completeness of the data provided. Nothing contained herein is intended or shall be deemed to be investment advice, implied or otherwise. This letter represents my views and replicates trades that I am making but nothing more than that. Always consult your registered advisor to assist you with your investments. I accept no liability for any loss arising from the use of the data contained on this letter. Options and junior mining stocks contain a high level of risk that may result in the loss of part or all invested capital and therefore are suitable for experienced and professional investors and traders only. One should be familiar with the risks involved in junior mining and options trading and we recommend consulting a financial adviser if you feel you do not understand the risks involved.

Energy Financial News
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