• 2 minutes Oil Price Could Fall To $30 If Global Deal Not Extended
  • 5 minutes Middle East on brink: Oil tankers attacked off Oman
  • 8 minutes CNN:America's oil boom will break more records this year. OPEC is stuck in retreat
  • 5 mins Iran downs US drone. No military response . . Just Completely Destroy their Economy. Can Senator Kerry be tried for aiding enemy ?
  • 37 mins The Inconvenient Truth Of Electric Cars
  • 6 hours California and Oil
  • 5 hours The Plastics Problem
  • 9 hours Win Against Tyranny: Turkey's Opposition Strikes Blow To Erdogan With Istanbul Mayoral Win
  • 6 mins NATO Article 5: Attack on one member is attack on all. Members all must come to defense . . . NOT facilitate financial transactions to circumvent and foil US Sanctions. Somebody please tell Angela.
  • 8 hours Green vs. Coal: Bavaria Seeks Fast-Track German Coal Exit in Snub to Merkel Plan
  • 3 hours Hydrogen FTW... Some Day
  • 3 hours Ireland To Ban New Petrol And Diesel Vehicles From 2030
  • 1 hour Oil Demand Needs to Halve: Equinor
  • 9 hours Here We Go: New York Lawmakers Pass Aggressive Law To Fight Climate Change
  • 20 hours What's more Important Iran Nuke Deal or Strong China Trade Deal. Hypothetically, If China offered Trump North Korean and Iran deals in exchange for concessions on trade deal should he take it ?
  • 18 hours Solar Panels at 26 cents per watt
  • 13 hours Fareed Zakaria: Canary in the Coal Mine (U.S. Dollar Hegemony)
Alt Text

The Last U.S. Oil Major In Venezuela

Chevron is the last U.S.…

Alt Text

The End Of Mexico’s Rigorous Energy Reform

Mexico’s President Lopez Obrador has…

Alt Text

OPEC Agrees To Schedule Meeting On July 1-2

After weeks of disagreements, conflicting…

Mad Hedge Fund Trader

Mad Hedge Fund Trader

John Thomas, The Mad Hedge Fund Trader is one of today's most successful Hedge Fund Managers and a 40 year veteran of the financial markets.…

More Info

Trending Discussions

Why You Should Buy Brazil's Petrobras

I often get asked why I haven't been more positive about Brazil (EWZ). The answer is twofold; an upcoming election was about to bring a regime change in the high growth country, and there was a huge supply overhang from the upcoming secondary equity offering from Petrobras (PBR), the largest in history.

That turned out to be a good call, with the main market dropping 6% so far in 2010, when most emerging markets were going to the moon.  PBR has been a great short, dropping 31% from its peak.

Now Petrobras issue is done, and it is time to review the space. The company raised a staggering $70 billion, with the Chinese government coming in a major participant. The issue was priced so low that success was assured, despite its gargantuan size. Hedge funds and institutional investors whittled down their PBR weightings, hoping to cover their underweight on the deal. As the issue was generously oversubscribed, they are now scrambling to cover these shorts.

Petrobras will use the funds raised to develop their enormous Tupi offshore field, which is estimated to have 50 billion barrels of recoverable reserves. That will double the company's production to 3.9 million barrels a day by 2014, which is equivalent to 20% of American consumption. The company is well on its way to becoming the next oil major.

I think oil is a great place for the long term, and now is not a bad time to get in, as it has been one of the few underperforming commodities this year. I usually say buy the dips, but the dip in PBR has been going on for the past six months, so just buy now.

By. Mad Hedge Fund Trader




Download The Free Oilprice App Today

Back to homepage

Trending Discussions


Leave a comment
  • Oliveira Simões on May 13 2013 said:
    I read your article and I'm appalled by your use of the expression "regime change" in reference to the 2010 elections in Brazil. First, I think you need to get rid of your preconceived notions about Brazil. Your wording shows that you are very ignorant and politically biased to say the least. After over two decades of military dictatorship (supported by the USA by the way), Brazil finally became a democracy in 1985. The 2010 election signaled the continuity of the Worker's Party platform, thank God and thanks to Brazilians smart voting. While the USA has an anachronistic electoral college system, in Brazil we have "eleições diretas" for president, meaning "one man, one vote". Therefore, there's no question in my mind that we have a more democratic system of government. We also have one of the most reliable voting systems in the world. Remember the mess created in George W Bush's reelection when the courts had to pick the winner? This is unheard of in Brazil. I urge you to learn more about Brazil and Latin America for that matter (and the world, why not?) and stop referring to "regime change" in Brazil. We Brazilians are proud of our democracy. We won't let an ignorant gringo diminish its worth.

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News