For whom the wells run dry
Emmanuel Samarathisa | 14 Sep 2018 00:30
Oil prices have been on the uptrend since their devastating crash in 2016. And there are indications that the bullish sentiment will remain for the world’s most traded commodity despite headwinds such as production hikes from the Organisation of the Petroleum Exporting Countries (Opec) and Russia, US sanctions on Iran and the tense Sino-US trade war.
US-based Goldman Sachs recently forecast that the buoyant oil price run will continue. Indeed, at the time of writing, major oil benchmarks were hovering around US$70 per barrel.
This might spell good news for local listed oil & gas (O&G) companies but not everyone may be fitto milk the profits from this rebound cycle. They include those that are highly leveraged and those that need to regularise their operations.
Consider bunkering and storage company Petrol One Resources Bhd which was recently threatened with delisting from the main market after failing to implement its regularisation plan by Aug 11. Six years ago, Petrol One was issued a PN17 notice, usually given to companies with serious financial struggles, despite being granted numerous extensions.
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