The Big Boys, page-371

Hi Jako. I traded Oilsearch and Santos earlier in the year for a modest gain but not really following oil. I generally don't like commodity stocks as the underlying is driven by factors other than normal investor activity and it's harder for me to analyse with confidence. e.g. major market participants are gaming supply at the moment with BHP/RIO in Iron Ore to force competition out and I think Saudi's in Oil trying to force the US shalers out.

My interest in Santos is more company specific, within an oil pricing environment at an extreme. So Santos has great assets, but got caught with high debt after a capex programme right when revenues collapsed. That's now getting sorted with their capital raising.

So I just think we have the double whammy of oil price that will bounce back at some point plus Santos itself having gone through stress and now sorting out it's issues. Eventually we'll see some headlines talking about STO's great assets, strong balance sheet now and recovering oil market and major funds will want and need to own it.

Not sure how far away that time is, but we should be somewhere around a low I suspect and worth monitoring.