I believe that Shell still has much further to fall.
By Royston Wild – Tuesday, 8 December, 2015
It has been a few months in coming, but crude oil prices finally crashed to fresh nadirs at the start of this week. The Brent benchmark toppled all the way back to within a whisker of $41 per barrel, taking out September’s lulls and marking the lowest level since 2008.
The black gold price has endured further pressure after industry cartel OPEC again refused to cut production on Friday, ignoring a steady stream of weak demand indicators and bloated stockpiles. Instead the group elected to intensify its market-share grab by raising its daily production target to 31.5 million barrels.
Adding to the gloom, Total chief executive Patrick Pouyanne — when asked about the direction of oil prices — said on Monday that “we don’t anticipate a recovery in 2016” as the market’s chronic supply/demand imbalance persists.
“In 2016 the growth of capacity will still be larger than the growth of demand,” the Total man commented, adding that “I don’t know if the price will be at $40, $45, $50 or $60 per barrel.”
But the risks are clearly skewed to the downside, in my opinion, and should crude prices finally break below the psychologically-crucial $40 per barrel marker, then all bets are off as to how far prices could fall. Indeed, chatter is still circulating that Brent could skid all the way back to $20 in the coming months.
Shell on the slide
Given this stonking market imbalance, not to mention the likelihood of additional US dollar strength, I would not bet against further share price weakness at oil goliath Shell (LSE: RDSB). The company has seen its share price track crude values lower in 2015, and its stock is now dealing at a 32% discount to levels seen at the start of the year.
However, I believe that Shell still has much further to fall. The business was recently dealing on a prospective P/E rating of 12.7 times for 2015 due to an anticipated 40% bottom-line slip, and earnings look likely to fall again next year as the oil price tanks.
I would consider a reading below the benchmark of 10 times to be a fairer reading of Shell’s risk-heavy outlook. And while the firm has remained vigilant in slashing capex targets and offloading assets to ride out the storm, these measures are likely to mean little against a backcloth of collapsing crude prices. Shell recorded a colossal $7.4bn net loss in July-September as oil values sank.
This website and sisters royaldutchshellplc.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.
Royal Dutch Shell conspired directly with Hitler, financed the Nazi Party, was anti-Semitic and sold out its own Dutch Jewish employees to the Nazis. Shell had a close relationship with the Nazis during and after the reign of Sir Henri Deterding, an ardent Nazi, and the founder and decades long leader of the Royal Dutch Shell Group. His burial ceremony, which had all the trappings of a state funeral, was held at his private estate in Mecklenburg, Germany. The spectacle (photographs below) included a funeral procession led by a horse drawn funeral hearse with senior Nazis officials and senior Royal Dutch Shell directors in attendance, Nazi salutes at the graveside, swastika banners on display and wreaths and personal tributes from Adolf Hitler and Reichsmarschall, Hermann Goring. Deterding was an honored associate and supporter of Hitler and a personal friend of Goring.
Deterding was the guest of Hitler during a four day summit meeting at Berchtesgaden. Sir Henri and Hitler both had ambitions on Russian oil fields. Only an honored personal guest would be rewarded with a private four day meeting at Hitler’s mountain top retreat.
IN JULY 2007, MR BILL CAMPBELL (ABOVE, A RETIRED GROUP AUDITOR OF SHELL INTERNATIONAL SENT AN EMAIL TO EVERY UK MP AND MEMBER OF THE HOUSE OF LORDS: 
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A head-cut image of Alfred Donovan (now deceased) appears courtesy of The Wall Street Journal.
