r59 - SLB
Yeah, I remain a believer in SLB. There is a lot of pessimism in the oil markets and the article you posted is a good summary of all of that pessimism. I think the Russian discussion is probably the biggest threat. When the Russians broke the potash cartel, it totally disrupted that market. While Russia is far more important to potash than it is to oil, I still think it would be a pretty big threat.
We need lower oil prices to knock out US shale production. The rate of cost delinces has slowed significantly so I expect that oil prices around $40 will have the same effect as last time, a significant slowing in drilling in the US.
SLB is clearly the global leader in oil services. I think their acquisition of Cameron will be a big positive and the timing of the acquisition was perfect (I love it when companies do that!). They have taken out a lot of costs and they will be leaner and meaner when the cycle turns. I still think SLB can go to $95-$100 over the next 9 months.
Just trying to make a few bucks.
