Agree with barny re:shocker reports. The US being the largest consumer of oil (20% of global market) suddenly doubled their output and cut their imports by a 1/3 or some such. This is a big deal due to how demand and supply in the oil market is well balanced, POO was rising after the conventional peak in 2013 or thereabouts, as supply was shortening. The impact on demand however, when the worlds largest consumer suddenly requires 1/3 less, more than offset the reduction in conventional supply. Service providers will be bridging the gap in a sharp recovery scenario. MRM still has a very modern fleet, with capable managment. It's all going to hinge on the US market, they are still producing a lot of oil though, and are able to export now with the embargo gone, IMO the US inventories will decline rapidly when the POO is at the right price and US demand for foreign oil will rise as output and reserves shrink, i still think this is about the gas pipeline to europe and i'd imagine very soon a decisive move will be made on this.
As Susan has pointed out to us all, there is not a lot of new oil on the market and as output has increased over a period of little development there will be supply stresses in the near term regardless IMO. I can think of a couple of aussie juniors that have made some recent discoveries, and what a time to do it, would be a good time to get on those also.
MRM just needs to survive a little longer to have ridden out this period. They do have some nice contracts to underpin the business. CAPEX is coming down rather quickly. They renegotiated with the banks. They have Black Crane on board who I think will help keep this one going, though if it does go south they will probably front cash for equity in which case dilution for us. They only had 85 million left at bank last half, will be interesting to see if they have any less if 2H is that much weaker.
MRM Price at posting:
43.5¢ Sentiment: Buy Disclosure: Held
