> All speculatively, knowing that their type of oil production is not profitable at all if oil once again goes below $70 a barrel, which could happen overnight (see Sept-Nov 2008)?
Is there an obvious reason they couldn't sell their oil forward (or just sell futures)? You can sell oil forward three years for around $89 a barrel at the moment, as opposed to around $93 a barrel for delivery next month.
That's for WTI, and Brent is currently even more (in fact the Brent curve is in contango at the moment). I don't know what grade Australian oil would be, but I wouldn't be surprised if it's closer to Brent than to WTI.
Is there an obvious reason they couldn't sell their oil forward (or just sell futures)? You can sell oil forward three years for around $89 a barrel at the moment, as opposed to around $93 a barrel for delivery next month.
That's for WTI, and Brent is currently even more (in fact the Brent curve is in contango at the moment). I don't know what grade Australian oil would be, but I wouldn't be surprised if it's closer to Brent than to WTI.