According to a Reuters report citing S&P research, the reason is a record slump in global refining capacity, by 3.8 million barrels daily between March 2020 and July 2022, according to a Reuters report citing S&P research.

While refining capacity shrunk, fuel demand increased by 5.6 million bpd, creating a sizeable gap with supply based on refining capacity. New refining capacity of some 2 million bpd should come on stream by the end of next year unless delays occur, which is quite likely, according to the S&P research.

Further capacity increases are much less likely as refiners are suspicious that the energy transition push will turn potential new refineries into stranded assets before too long.

In this situation, the future does not look good for fuel affordability or wide availability. As the EU oil and fuel embargo enters into effect, Russia will turn to new clients in Asia, Africa, and, according to Bloomberg, Latin America. The EU itself will need to source its fuels from places like the Middle East, the U.S., and, as noted, India and China.

Because of the tight supply situation, which would certainly add a premium to fuel prices, it is not inconceivable that countries importing fuels from Russia, such as the two Asian giants and Saudi Arabia, could choose to do what China does with Russian LNG: resell it to Europe at a premium.

Meanwhile, the U.S. is experiencing its own constraints with fuel inventories, notably middle distillate inventories, diesel and jet fuel. What this means for Europe is that the help it can expect from the U.S. in the form of higher fuel exports would be limited: there is simply not enough diesel fuel to export. This could add a further premium to fuel prices this winter.


https://oilprice.com/Energy/Energy-General/The-Energy-Markets-Next-Crisis-Oil-Tanker-Shortages.html

https://oilprice.com/Energy/Energy-General/Wall-Street-Is-Increasingly-Bullish-On-Energy-Stocks.html

A shortage of critical fuels such as natural gas and diesel could boost the stocks and bonds of energy companies as they have the ability to invest in more oil and gas supply.

Years of underinvestment in the oil and gas sector has come back to haunt global energy supply, according to Jeff Currie, Global Head of Commodities Research at Goldman Sachs, which has been bullish on oil all year.

“The only way you’re solving the energy problem in the long run is through investment – and oil companies are the conduit for the capex to solve the problem,” Currie has told Bloomberg.

https://oilprice.com/Energy/Energy-General/The-Global-Fuel-Market-Will-Remain-Tight-For-Years-To-Come.html

Record volumes of refining capacity have been shut down over the past two years, which will lead to tight global fuel markets that will last at least through the middle of this decade. According to a new report by the International Energy Forum (IEF) and S&P Global, we can expect high volatility in fuel markets and fuel prices.

Between 2020 and the middle of 2022, as much as 3.8 million barrels per day (bpd) of gross atmospheric crude distillation capacity closed - a record high number, the report found.

Lower crude distillation capacity and reduced petroleum product exports from Russia and China drove refinery margins to record levels this summer, to a record $35-50 per barrel compared to the typical $10 a barrel, “underscoring the severe bottlenecks in the sector,” said the report from the Riyadh-based IEF and S&P Global.

A big thank you to all the contributors to this forum, for and against. All views with regards to this specific counter are very welcome.

However, lately, there has been lots of insults and vulgarity from both camps. As a fence sitter, it is disheartening to see these kind of things in a forum specifically designed to share useful thoughts. Is there a purpose to this?

Also, there are certain quarters who like to copy and paste the same post numerous times. Again, is there a reason for this as those who are following this forum would have read their first post already?

We are all here to make money.
It is obvious that those who are pro-HY would want the share price to go up (going long) and those who are against-HY would want the price to come down (collecting lower or shorting) for each individual's own reasons.

In the end, this may fall on deaf ears but I would hope that this forum be used for productive arguments instead of bashing one another which serves no purpose. TAYOR.

Peace!!!

Super good

Good news look to be coming. QR not out but moving upwards.

Fingers crossed

Damien88. Did you see Euroz Hartleys 2021F PAT of AUD103.3m?

Qr should be before the end of the week. Hope for good news...

Post removed.Why?

Actually they have been operating the 12 out of 16 furnaces since July 2020. If they managed to get the remaining 4 online, then their output should be about 33% more.

3rd quarter results should also be better than the 2nd quarter since the Salmaju plant was shut down for almost a month due to the lockdown.

Furthermore, this is not including the increase in prices of all their products from the FeSi, SiMn, LCSiMn, Mn Ore etc.

Thanks Loop37

Hi sims. Where can I see this virtual briefing too?

The current pricing of ferrosilicon itself can carry this company forward... Also with the huge advantage compared to the other manufacturers with the hydroelectric power they are using...keeps cost down and margins high.

https://www.reuters.com/business/energy/lmeweek-power-crunch-hits-europes-silicon-zinc-supplies-renewables-2021-10-15/

Don't forget the seafood asking to sell too. Many types of seafood.

China is the biggest silicon manufacturer in the world, producing 68% of all the silicon manufactured in 2020. And now they are short on power due to high coal prices, and low rainfall at their hydroelectric dams. Now currently their coal mines are flooded making their problems worse.

https://www.google.com/amp/s/www.bbc.com/news/business-58879481.amp

Production of Silicon metal is a very energy intensive process and PMB is producing these products using hydroelectric power and hence, they are not effected by high gas, oil or coal prices like the other manufacturers are currently facing.

Prices of silicon metal is currently about 4x the average price a few months ago. It was reported that high prices will remain until summer 2022.

A lot of name calling here, saying sifus here and there but all are here to share. Decision to buy or sell is up to you. Please do your own research.

TAYOR.

Think you may be right on this. Read some other companies have a blend of these contracts and index based prices.

Ahahah If they can hit 250mil in Q4, then consider very good. A company like this will be easily lock in 50% for long term that they can’t change the selling price.

@Ahahah. True what you said regarding the contracts. May not be reflected immediately. Was basing on 20000 yuan/tonne and full production capacity. Guess we will have to wait till the results are out. Q4 should be good!

End of November 3rd quarter results will be out. Calculations are based on current news...
TAYOR...

3rd quarter profit estimated to be around 70-90 million.

4th quarter RM500++ million...

PE of 10, current price should be RM103! PMB need to issue more shares

At current prices of 60833 yuan/tonne and production of 72000 tonnes/year, this equates to almost RM2.8 billion a year at current prices.

With operating expenses of RM640 million/year, the profit is almost RM2.1 billion a year.

This gives an EPS of RM10.31!

Does anyone know if their Qinzhou plant is operational or shut down due to the power shortages in China?

Hopefully got some good dividend along the way.

Based on USD200 million profit, EPS is around 108 cents? If based on PE10, price should be around RM10.80!!!

Usually manufacturers use around PE30.

Damien88 With the current ferroalloy prices at all time high, and continue to move higher ie up another 40% MnSi (manganese silicon) and 80% FeSi (Ferrosilicon) in 1 month from Sep 2021, we can expect profit for OMH to surge to record high US$200-300m based on current spot price.
OMH forward PE is now record Low 2-3x based on RM3!!!

Damien88 sifu. Just wondering if you know how is the other subsidiaries of OMH doing? Is their plant in China affected by the shutdown there....? A bit confusing since this OMH group is quite diversified.

Hi sifus. Newbie here. Do you know if pmbtech is at full capacity 72000 MT already?

Many investors who bought this were hoping that the stock price would hit at least around RM3 or more in the future. With its increasing profits, Malaysia's economic recovery and rumoured port listings by the end of the year, this would eventually be a reality.

The offer by SM comes at a time when the stock was already beginning to move up. It has already gone up about 50% in the past 6 months. Previously, for those who have been around for sometime, there were blockers pushing the price of this stock down. Could this be a reason to keep the price of this stock artificially low for a takeover?

If what emsvsi says about the value of port listing which alone values MMC around RM4 is true, then a RM2 offer is way too low. MMC should be valued more than RM5 if this happens.

At RM2, it definitely is just a quick profit, but we would be selling it at a price much cheaper than its worth.

Just my thoughts...

Ex-divided date approaching...

Slow and steady....hopefully can maintain uptrend this round.

Yes cancelled...

JoshuaMS7, why do you keep saying the stock will crash? Do you have any news? Cause all indicators are pretty positive for this stock.

can collect more at lower price....