Millionaire Son in Law Chapter 7526 Aren’t you dead?
Please read this chapter.
- A meeting about crude oil business.
- Discussions on market speculation and hedging strategies.
- A proposition involving oil reserves and future deliveries.
Rachel’s father, David Getty, had been waiting at home for some time.
He was very happy to meet Du Heng, and took the initiative to stretch out his hand to shake hands with Du Heng, smilingly saying, “Mr. Du, why are you visiting so late today? There has never been an incident like this before.”
Du Heng smiled and said, “Our chairman needs me to come and talk to Mr. Getty about some business matters. It’s about crude oil.”
David Getty smiled and said, “No problem. I wonder how much shale oil Mr. Du plans to sell through us this time?”
Du Heng shook his head and said seriously, “We don’t plan to move; we plan to buy.”
“Buy?” David Getty asked, confused. “You are a shale oil extraction company, not a refining business. Why do you suddenly buy crude oil?”
Du Heng did not hide anything and smiled, “Our chairman recently had some opinions about the situation in the Middle East. He thinks that the possibility of the situation worsening is relatively high, so he wants to stock up on some oil first to see what happens.”
David Getty was a bit surprised. He said, “Mr. Du, the situation in the Strait of Hormuz has eased recently. I heard that a new round of talks is about to begin, and shipping lanes have improved a bit. It won’t be long before international crude oil prices will fall. Although it is unlikely to plummet, it will at least fall by 15% to 20%, because after all, oil prices have risen too high recently.”
Du Heng smiled and shook his head, saying, “Everyone has their own judgment. Our chairman thinks that the situation will most likely become tense in the future. So let’s see if Mr. Getty can take some of your family’s oil reserves and the crude oil that will arrive soon and sell it to us. We are willing to offer a 5% premium. If the oil price falls, we will bear all the losses and the 5% premium. If the oil price rises, we will only get the difference between the 5% increase and the 5% increase. For the Getty family, this should be a very profitable deal.”
David Getty nodded slightly. The essence of running a big business is hedging. When oil prices rise, you cannot put all your money into long positions; when oil prices fall, you cannot put all your money into short positions.
The Getty family is optimistic about the future trends of the Strait of Hormuz because the situation is gradually improving amidst the fluctuations of the previous and even recent periods. Therefore, oil prices will definitely fall slowly in the future. So they intend to reduce crude oil imports in the next period and increase imports after prices fall. However, the crude oil that has arrived or will arrive is purchased at high prices, which is not very cost-effective. If they can sell it at a high price now, they can make an additional profit of 5 points, which is definitely a good thing for the Getty family.