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BP – Good News?
BP stock is down about .8% in pre-market. A bit of a surprise given that
they finally plugged this thing. There is other news that may be
trumping the action.
There is a new “hard” estimate on the amount of oil that was leaked. The
number is 205,800,000 gallons. That is 4.9mm brls. If you applied a
fine of $4,300 per brl., it comes to $21b.
There will be a fine. Using the $4,300 number may be overstating things.
But there is no reason to expect the Administration to be lenient
either. A slap on the wrist is the most unlikely outcome.
Say it is $20b. There is another $10b that has been committed. And then there are the direct costs. It could get to $40b.
That would not sink BP. But it will kill the dividend for a long time. Sell on the news?
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And now for the not so good news?
http://pesn.com/2010/08/01/9501682_Gull_Loop_Current_Stalls_from_BP_Spill/
http://www.mnn.com/green-tech/research-innovations/blogs/death-gyre-in-the-gulf
Ck the links while ya can, some are already missing.
Updated DOW daily chart:
http://stockmarket618.wordpress.com
Of course BP has to stay a healthy corporation. Just imagine what would happen to British pensions should BP default. Billions of pensioners funds are invested in BP.
This always was a national security issue for both the USA and the UK. No way this was going to end any other way.
While the day to day details would be fluid, the end game was written in stone when Tony the Tiger and his posse left the White House with an "agreement in principal" in hand.
Game, set and match.
it just seems like it's a perpetual game of "lessor of evils" anymore.
too bad we're taught in grade school to simply "do the right thing"
so they've been teaching us the wrong chit... i want a refund.
(but if i got bad grades in the 'wrong stuff', does that mean i'm doing the 'right stuff', or does that just make me a loser?)
Actually that makes you a victim. What ya gonna do about it? Seriously. There are extremely valuable benefits to the psychological warfare technique of rubbing your nose into your own helplessness and impotence. Ever wonder why we're so often told about corruption or bank bailouts or public rage over wars that never end or political promises that are easily handed out and never fulfilled but nothing is "done" about it?
BTW I've decided that my grade schooling was/is correct after all. We do live in a "democracy" and not in a representative republic. However, despite the fact that "we" are the majority, we don't get to determine what we want nor can we even vote on it either directly or through our "representatives". Both our own "decision" process and the "voting" process are shame scams, manipulated and influenced both overtly and covertly.
Now, what am I gonna do about it?
i like your comment about the grade schooling being right after all! heh
my education comment was more tongue-in-cheek than it probably read.
to be sure, i'm no victim, as i explicitly choose not to be. and that *is* a choice.
many of your writings implicitly reference this very point which is in large part why i appreciate your thoughts.
i'm trying to sort out honest facts from a bazaar full of folks selling nothing but agendas. worse, i was trained how to think by folks with similar agendas... it's a bit of a mess up there in me noggin.
some great examples of clarity in here tho. some of the other kind too... heh
cheers
These guys are awesome! 74% of the oil is gone from the GoM. 74%! Not a measly 73%, nor 75%, but 74%. Spot on.
http://www.businessweek.com/news/2010-08-04/u-s-says-74-percent-of-bp-oi...
They rounded it up from 73.8729%. You saying they should not have done that?
Rocky,
Can't you keep your partying from waking the neighbors? If you can't hold your liquor, maybe you should find someone to hold it for you. : )
http://www.suburbanchicagonews.com/newssun/news/2548528,5_1_WA30_RACOON_S1-100730.article
Hey, Janice! Long time, no see, Sweetie. Thanks for the coon story. Sure looks like cousin Ralph. He always was a rascal.
As fer likker, I quit that a long time ago. For the very reason in that article. Lotsa damage.
Shorting BP right after the accident was a smart thing to do. Shorting BP now is stupid thing to do.
Not only is it starting to look like the whole think was overblown, you would also be shorting a company that has the full backing of the UK government and all the leverage comes with that.
How many other companies can get the Prime Minister of Britain to lobby the US President directly on their behalf?
BP will get a big fine. Maybe even the full $4000 per barrel. They don't care about the fine.
What they do care about is being able to continue doing business in the US - and it seems fairly clear to me that Obama and David Cameron have already agreed that there isn't going to be a problem in this regard.
A while back Obama met with Cameron and then made the statement of something like: "We agree that BP should remain a strong and viable company". After that the stock price started to recover. I agree, no point in shorting it now. But not much point in going long either. Governments are in bed with the corporations.
Don't know about BP, but some big hedgies have loaded up on Transocean at these levels:
IMO the deal was cut at the highest levels between the elite family in the UK and the US. The overuse of massive amounts of corexit (which has long term health implications), understates the visable (for TV impact) and lets BP off the hook. The legal system will push the liability to 1000 other entities (Anadarko, Cameron, MMS, HAL, SLB, etc). UK is our partner in the financial and military crimes. Their cash cow (BP) must be allowed to continue generating the sweet milk that funds the criminal activities.
Alas, this and more is expected (and increasingly seen) from the marriage of corporate and governmental interests, aka fascism.
Hey we learned a lot from that disaster
1. BP is as evil as GS
2. Media whores for BP
3. Gov't whores for BP
F them all
Question: Why should we assume a serial liar like the US government is suddenly telling the truth?
Answer: We shouldn't.
But when we have been conditioned our entire lives to love our lying cheating wife and child beating sex/drug/alcohol abusing Dad, we now have a severely dysfunctional co-dependent relationship with said parental substitute and to separate at this stage of life would be even more traumatic than staying in the abusive relationship.
At least that's what we co-dependent dysfunctional passive-aggressive consumers have been told to believe. And we always believe higher "authorities" even as they are abusing us.
Lesson learned very well.
The proof in the pudding might be a mighty hurricane that will suck up a bunch of that Gulf water and deposit it from Louisiana all the way up to Kentucky. Black pudding that is.
roger
question your skepticism
Given how much oil was released into the ocean I think that so far things are going a lot better than expected: light crude is easier on the system, some was cleaned up, some apparently evaporated (who knew?) and some is/will be broken down biologically. It still sucks and some giant underwater blob of oil could still wreck havoc I suppose but it seems like many expectations, including mine were a lot worse than what seems to be playing out.
What hasn't exceeded expectations is Mr. Community Organizer who is well on his way to proving that he sucks at everything that doesn't involve the destruction of something or other: "clunkers", children's toys and books, the healthcare system, bankruptcy law, national sovereignty, wealth, personal liberty, private enterprise...
When are you all going to realize the market is never rational. Instead of whining and complaining you should just roll with what the market is telling you. Ive been long BP both in OTM calls and stock since is was $37. I will continue to be long because I expect the probability of BP going up in near future outweighs the downside. When if/ the market starts to show downside I will exit my positions and consider going short. Now is not the time though. I hear a lot of "hope" and "assume" in your posts.
What many of us whine and complain about and how our money is invested are quite often two different things. I can moan and groan to my hearts content and still be long when it's warranted and short when needed.
Don't mistake a sense of outrage or anger or even bearish longer term view with an investment/trading position.
Word
Amen.
Actually, IIRC, over at TOD (www.theoildrum.com) someone posted in some detail on the subject. They indicated the fine is UP TO $4,000/bbl. There is aparently a set of legal guidlines when assigning the value per barrel.
4k/bbl is a cap, not a required penalty, at least that was my understanding.
Regards,
Cooter
Found it. It was a link to a new article.
http://www.theoildrum.com/node/6507
Article (Reuters) here:
http://www.reuters.com/article/idUSTRE64O75Q20100526
Regards,
Cooter
Actually, didn't they spray fuckloads more of the disperment agent than they were authorized to do? That effectively thins the surface layer of the oil. What lurks beheath? Well, fuck, we can all just speculate on that...to the downside.
I'm holding long puts because I ASSUME American will hold a fucking grudge and not buy gas at BP. Or, the ones with a sense of anything at all won't.
I went long BP at 28 and got out at 37. no big deal. just like long RIG at 48 and out at 54.
everything gets overplayed on the upside and the downside.
when I saw matt simmons predicting a nuclear winter and the gulf of mexico sinking into the earth's core in a fiery implosion, I knew it was time to buy
Taking ZH content too seriously can be bad for your financial health; look at GS
exactly.
glad that not everyone here bases their trading on emotion and paranoid conspiracy theories.
I was hoping to find some intelligent discussion of the bear case here.
Jury's still out.
According to Mr. Allan, the EPA is making the calls on the usage level of Corexit. Seem to remember reading that in one of GW's posts a couple of weeks ago. With the government giving the green light, there will be no legal recourse for victims.
Imagine the response of ABC, NBC, CBS, CNN, MSNBC, NYT, WaPo, Huffington Post and the Center for American Progress if John McCain's environmental spokesperson made this claim? Hypocrisy abounds from the usual progressive suspects.
Let's have a banquet at the White House and Capitol Hill where the hoerderves are shrimp cocktail and crab cakes from the Gulf. Lead by example with your health.
Not for George Washington.
ya, Bruce, can u make some comment about this government report saying most of the oil has "disappeared" ?
No comment. It seems to be gone. Was it the dispersant? Did microbes eat it? I am happy that it is gone, but I have trouble with the idea there will be no consequences of this.
I don't think anyone thinks there won't be dire consequences, just that it won't be anything even remotely close to the scenarios discussed by many zh doomsters.
Yea, that's the educated opinion we were all looking for. You don't *think* the worst oil spill in the history of mankind will be as bad as people think. Thank you, so much, for that worthless personal impression of something you don't understand.
c'mon bm,
there's no precident for this sort of mess/dispersal - anywhere - ever. how many natural leaks like this happen off the pacific coast every 50 years that are never even 'experienced' by humans - and life goes on. sometimes man just doesn't know.
realize that the oil spill is academic to the attitude shown in your comment.
while i *do* respect those that would *prepare* for the worst they might imagine - that's a simple form of intelligence - i'm not so sure there aren't those who seem to *hope* for the worst, out some morbid genetic inclination. often, both types find themselves at the same gatherings (e.g. ZH).
you seem to *want* the disaster, given that when someone simply implies that "perhaps it's just not the issue we thought it was", and you resort to "...that worthless personal impression..." wtf?
then i look for some useful fact-based counter-point... oops, missing...
consider your avatar - "warning 666 is coming". maybe it's not - maybe it is... your insights are encouraged, but so are others. inform us, don't decide for us. it's quite possible you are wrong. or right.
is it possible this spill won't be as bad as predicted - yes. is it possible that geitner/bernanke actually know what they're doing, yes. do most of us have any confidence in either? right now, no. so why attack the possibility when it is indeed possible.
anyway, i'm not gonna fix anyone in here, but the discourse might be improved for the comment. or not.
be well
bingo i.k. And this is one of the problems I have with these depressing doomsters (others being their hatred of success, capitalism, reason, science, and their bizarre love of ridiculously convoluted conspiracy theories).
They say they are seeking the truth when they are actually spreading as much BS as the MSM.
I have no idea what the long term effects of this spill will be, but I know the sad souls predicting the end of the world are wrong again, and they clearly damage their credibility (ahem) by making such ridiculous claims.
As for Ben B and Geithner, no I don't believe they are doing the right thing, and they certainly know they are running a huge risk too.
They are just trying to buy time while praying that recovery takes hold.
I don't think they will succeed, but it's possible they will put off the inevitable collapse for years (or it could all collapse next week, no one can predict the future with certainty).
Having an open mind, as you do, will help you immensely whatever the case might be.
Our friend BM on the other hand will continue to bang his head against the wall and never understand why the world doesn't behave as he wishes it would (it's all manipulation!!)
But i'll cheer him up by sending him photos from my travels around the world, now that I no longer have to work, I have lots of time for little pleasures like that.
Maybe he'll even come out of his bomb shelter and see the sun shining.
Wait, we are talking about the BP oil spill, their cover up, their liabilities going forward and what effect that will have on the value of common equity....right? Because I don't know where the fuck you just went with that post. Please advise...standing by...
your BP spill comment belies a bigger problem than oil spills.
- you discount a viable comment (roughly "maybe it won't be so bad as they feared")
- you offer no meaningful counter-argument
- you imply stupidity and attack character
rather than assert that "sure it would be great if it wasn't so bad, but i don't believe it yet"
(which is about where i am on the debate)
you do what you ... did
if you track this place for long enough, you'll find that there are folks that seem to *want* the tragedy. with your avatar and tone, such a conclusion isn't coming outta left field.
i find the trend towards this to be a bummer if it's intentional trolling, and simply depressing if it's what our collective discourse has been reduced to.
like i said, i'm not gonna fix anyone, so take it as you will. i like some of the information and opinions you've written. if you do think it's gonna crash, best wishes in your prep and management.
I went long BP at 29 (sold at 36 dammit) based on the vague notion that the effects of this were being wildly overblown, and reading the extremist zh'rs on TOD convinced me.
I look forward to many other great trades based on nothing other than my reading of the paranoia level here, so thanks in advance.
I have just started building a new short position (s&p, not bp, I am out of that totally), based on not much more knowledge than I have of long term effects of oil spills/leaks etc., which is to say, about zero.
My research is less than rudimentary, but I manage to be retired and writing this from a cafe near a beach, I guess thanks to the those who research things to death, looking to support their pre-conceived theories, and base their trading on their dogmatic beliefs.
So thanks again!
Wow, thanks! Gee, you're so fucking awsome. You just offer up all kinds of stuff that nobody asks for, nobody believes, and nobody even cares about. I love the opulent lifestyles shit though...man, that's just dripping with reality.
Thank you for that.
You mean as in "the vast majority of the oil appears to be gone"?
I used the official NOAA/NYT chart. The "still at sea or on shore" oil figure is well into the upper range of estimates of the total Exxon Valdez spill volume and 2.5 times the official Exxon Valdez spill estimate, and it's still out there in the wild. Then add in 1.8 million gallons of Corexit (a figure that BP has been accused of seriously lowballing).
No oil to be found anywhere Bruce,205,799,999 gallons evaporated into thin air (now thick air) A few traces on the shores and a few unfortunate birds is all thats left and thats where the missing gallon went
Total fine: 300 bucks...
Plus the usual MMS tip.....er.....kickback.....er......bribe.....er......accommodation.
The end product of all that "dispersed" oil is no longer measureable except by scientific analysis. That means experts can now start arguing about residual dangers or if there even are any, depending on their loyalties, with a lot of boring technobabble. A year from now there will be competing blog groups contending over whether anything at all really happened back in 2010. This is over. Erased from history.