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Microcap & Penny Stocks : Rentech(RTK) - gas-to-liquids and cleaner fuel -- Ignore unavailable to you. Want to Upgrade?

To: jan m. who wrote (10736)	10/10/1998 4:12:00 PM
From: S.C. Barnard	Respond to of 14347

Hi Jan: I asked a similar question of dblumoney on Yahoo a while ago (7/26)- here was his response, open to dispute- Short term dips in oil prices will not affect RNTK. The lower that oil prices go, the more the big oils will look at ways to improve refinery operations--like using RNTK's F-T technology. Since an operational TX-RNTK plant is still at least a year or two away, it really means very little. As has been said many times before, if you care to predict the price of oil in 2010, then it will undoubtedly be much higher. However, Brinker does have some pull, and will likely keep some buyers away, but not too many--since he doesn't like to talk about penny stocks. I've always been puzzled by the effects of low oil prices. If we were an oil exporting nation--it would be bad, but we actually buy oil, which is now cheaper. If I ran a big oil, I'd be buying the cheap oil, run up big refinery margins, and then slowly let the consumer price come down. I've actually seen bigger profits in the big oils when the oil price does go down. If the big oils own an oilfield that costs $14 a barrel to pump, then just slow down production and buy $13 oil on the open market. Scott

To: jan m. who wrote (10736)	10/10/1998 8:45:00 PM
From: eric deaver	Read Replies (1) \| Respond to of 14347

Jan, Be aware, the business is very segmented. Low crude prices means (usually) over production hence the layoffs in the E & P segment. Low crude prices paired with high consumer demand usually means higher refinery margins and increased bottoms generation. If the price of diesel drops as a result of dropping crude (I think RNTK thinks $0.50 / gallon is the break even) then the RNTK diesel is not as competitive and demand for that product will drop. Usually, though there is a significant lag between dropping crude prices and dropping refined product prices. FWIW, Eric