Title : This Is Not An Investment Site -- Do Not Make Any .... July 22, 2018
link : This Is Not An Investment Site -- Do Not Make Any .... July 22, 2018
This Is Not An Investment Site -- Do Not Make Any .... July 22, 2018
Fitzsimmons on Chevron over at SeekingAlpha:- integrated global energy giant is hitting on all cylinders (production, refining, & chemicals), yet the stock has been relatively weak
- that presents an opportunity for investors prior to the upcoming Q2 EPS report, which is due out this coming Friday
- current Q2 consensus EPS estimates have risen $2.10/share, but I think the company could earn $2.45+
- the current $4.48/share annual dividend yields 3.6%. Blue chip Chevron is a BUY and I raise my end-of-year price target by $5 to $145
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For All Those Bernie Sanders / Alexandra Ocasio-Cortez Supporters
Funny how things work out. Yesterday I posted three "international" stories -- for the archives, to keep the Bakken in perspective -- and then this, from The WSJ: oil-rich Iraq can't keep the lights on.
Does this sound familiar? Think Venezuela.
From the linked article:
Temperatures across southern Iraq are so high in the summer months that birds drop dead from the sky due to heat exhaustion. And tap water runs piping hot.
So when Iraq’s power supply faltered this month as a heat wave ramped up air-conditioning demand, it ignited an angry question: Why can’t one of the world’s top oil producers keep the power on?
Protests have rippled through Iraq’s oil-rich south for over a week as demonstrators railed against the government’s failure to provide basic services like electricity, health care and clean water. They have posed a serious enough risk that authorities have shut down the internet and sent in troops to quell the unrest.More:
Iraq had been purchasing electricity from Iran for several years, but Iran cut the power citing unpaid debt and electricity shortages of its own. Ministry of Electricity spokesman Mosaab al-Modares said Iraq has the money to pay, but can no longer transfer the funds without violating U.S. sanctions on Iran.
The biggest problem, however, isn’t electricity generation, but distribution. As much as 65% of the power supply is consumed by people who illegally tap into the grid or don’t have electricity meters, according to the Ministry of Electricity. Fee collection is also weak. In 2015, its best year to date, the ministry said it collected just 12% of fees.
The government tried in 2015 to collect more fees and stop illegal power consumption, but a popular backlash stalled it. Among the biggest opponents, Mr. Modares said, were private power generator owners, who he says collectively make around $10 billion in annual profits from the government’s failure to provide electricity.This comment hit the nail on the head:
“Iraqi electricity demand has grown to 23,000 megawatts at peak summer demand, but the country can only produce 15,900 megawatts, according to Iraq’s Ministry of Electricity.”
“…private power generator owners, … make around $10 billion in annual profits from the government’s failure to provide electricity.”
A few questions.
The “make around $10 billion in annual profits” number?
Is the number credible? We don’t know because we don’t know if the source’s data was reviewed for accuracy. The source, a government official, might have a reason to provide an inaccurate number.
How much of the production deficit (23,000-15,900=7,100), if any, is produced by the privateers?
How much does it cost the privateers to produce the energy?
In some worlds the privateers would be considered entrepreneurs.
Maybe the importance of the article is to point out that governments’ bureaucracies are, in fact, inefficient everywhere.
Maybe Iraq should privatize its government electric company.
Thus Article This Is Not An Investment Site -- Do Not Make Any .... July 22, 2018
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