I believe the 'W' bottom has formed.
I've finished buying back into the stock between $7.15 and $7.28 and have regained the same level of shares I held during the rise from The mid $4s to $7 where I sold off (admittedly too early) in late January. I mentioned then that BBEP would form the classic 'W' bottom and that it seemed to be forming one then...although not the true second leg. I believe we are preparing to see the second true leg up in the long climb back towards $15-$17 a share.
Initially I may have read too much into any rumored 'political deal' between the Saudis and Americans. It is now my opinion that as is the usual case, the Saudi's are in this manipulative and designed 'pullback' in oil prices mostly alone and for their own wallets. Rather than punishing their political and regional religious enemies, it is likely the Saudis are simply trying to drive some of the world's newest tar sand and fracking drillers out of business to avoid newer future oil supply compromising their profits. They have largely succeeded in doing that as it didn't take an awful lot of $48 BBL oil splashing about to bankrupt these unhedged start up fracking drillers. The entire deal could have also been staged as a short term warning for any new start ups to 'stay out for good'. The Saudis have now delivered the message that they can do this at any time and as often and for as sustained a time as need be to take all newbies under.
With most the drilling yards in the US piled to capacity with idle rigs and the majority of 18 month or under start ups financially damaged beyond recovery, the Saudi's may see the end of their experiment in sight for the time being. As was mentioned by another member in an earlier post, 2015 was to be the year in which world oil demand in the face of even a weak economic recovery would see tanker transport capacity tapped out. With an estimated 15% of the world's fleet now being used as floating storage, it may be time for the Saudis to crank back their pipelines for awhile, let the world absorb that tanker capacity (est. 10-15 days?) and ease prices back into the $65 BBL range. High enough to make their oil wildly profitable...not high enough to allow the newbie frackers to drill their way back to recovery from their devastating losses. This might be the future we are looking at for the Saudis in the face of a dysfunctional OPEC. Like the Fed controlling inflation with interest rates, the Saudis control future supply coming into the market with their own spigots and kill two birds with one stone.
As this relates to BBEP, if I have timed it right (and there is absolutely no evidence that exists today I have) and if oil is headed back towards $65 or $70 BBL over the next six months, BBEP's share price is headed back towards $11-$14 IMHO. And with the $1.00 annual dividend in tow...providing evidence of this predicted price per barrel recovery becomes known before their April lender review. It is going to be a fine line, but BBEP has again and again offered guidance that they are hedged to see this through well into 2016 with average per BBL prices in the $60-70 range. So any move or even any anticipated sustainable move over $55 BBL in oil prices is sure to ease their creditor situation.
This may not be the optimum time for getting back into the shares and either way it is still a huge risk for anyone who might need this money short term. But I'd rather watch the short term turmoil between $5.00 and $7.50 than miss an entry point into the big money momentum all together. That being said, I have faith that long term BBEP will be back well over $17 a share. That belief has it's foundation in nothing more exotic or analytical than avarice. Unless you have ceased to believe in supply and demand or Saudi greed....or just plain old greed in general, I have a feeling there are those of you out there who will tend to agree with me.
SBB
Pojama people, pojama people people...Lord they make you sleepy with the things they might say...
