Imagine that Ecopetrol shares are not sold in pesos, as happens on the Colombian Stock Exchange, nor in dollars, as happens every day on the New York Stock Exchange. Imagine that the Colombian oil company’s stock is exchanged for the main product it sells: crude oil. What would have been the worst and best moments in the almost 17 years that the stock has been trading on the stock market?
According to the criteria of
The company’s history on the stock exchange began on November 28, 2007, after Almost half a million Colombians bought shares for 1,400 pesos each. That first day, buyers offered as much as 1,695 pesos per share, but no one wanted to sell because, as would indeed happen, they would go up much more.
Likewise, The stock is traded on the New York Stock Exchange in packages of 20 shares known as ADRs. (American Depositary Receipt), i.e. certificates of participation in foreign shares issued by United States banks.
With the fall of more than 5 percent in the shares on Wednesday on the exchanges where they are traded, Ecopetrol is going through one of the worst moments in its history in those markets.
With the fall of the stock, this Wednesday on the exchanges where it is traded, of more than 5 percent, Ecopetrol is going through one of the worst moments in its history in those markets.if the cause is taken into account: the bank JP Morgan recommended its clients to reduce their investment in the Colombian state-owned company.
The institution gave three main reasons: the increasing insecurity in Colombia, especially in the regions where the company operates; the inability to adjust fuel prices, which was made clear by the truckers’ strike in which the roads were blocked and, incidentally, the possibility of charging what the Government wanted for diesel fuel; and the conflict between the interests of the administration that the Government placed against the interests of the shareholderswhich is reflected in not signing the deal to buy the entire business in the United States in which it participates, which has been the most profitable recently.
What Ecopetrol shares were worth at the time of its debut
On November 28, 2008, pFirst day of trading in the history of Ecopetrol sharesthe buyers offered 1,695 pesos per share, and none of the new shareholders agreed to sell that day.
On the same day, a barrel of oil was traded worldwide at $94.4 and the dollar was worth 2,094.7 pesos in Colombia. Thus, one Ecopetrol share, if paid in kind, would be equivalent to 1.4 liters of crude oil.
Within a year, when oil was around $100 a barrel, the stock was also delivering the expected profits for families who had invested their savings.
As of September 19, 2008, The stock was worth 2,580 pesos and the barrel of oil, 97.9 dollars. Families had earned 84 percent in 10 months.At that time, taking into account the exchange rate of the day, each share had risen to the equivalent of 2.2 liters of crude oil per title.
The best moment for Ecopetrol’s stock in its history
A few years later came the best moment for Ecopetrol’s stock in its history on the market. On February 1, 2013, the title closed on the Colombian Stock Exchange at 5,650 pesos.. Oil was worth 97.5 dollars per barrel and the dollar, 1,776.2 pesos. Thus, At its peak, Ecopetrol’s stock reached 5.2 liters of crude oil for each one.
But then, Oil prices are expected to plummet due to booming production thanks to frackingwhich some countries like the United States began to take advantage of. The profitability of companies like the Colombian one fell, they had to take out of production wells that no longer provided margins and, of course, the share prices suffered significant losses.
By 2016, crude oil prices had already recovered somewhat, but oil companies such as Ecopetrol were still going through difficult adjustment processes to regain their profitability.
Finance Minister Ricardo Bonilla and Ecopetrol President Ricardo Roa at Ecopetrol’s ordinary meeting in March 2024.
Photo: Nestor Gomez
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The toughest moment of the action was on January 22, 2016, when it was traded at 1,020 pesos, with a barrel at 32.2 dollars and the dollar at 1,776.2 pesos.. Thus, the price of the share was only equivalent to 1.5 liters of crude oil.
But even then, the value of the stock was not as low as it is now in relation to the price of oil. On Wednesday, with a fall of 5.15 percent, the stock ended the day at 1,840 pesos. And with a barrel of oil at $73.5, the value of one share was only equivalent to 0.9 liters of crude oil..
At the time of publication of this note, Ecopetrol shares recovered 0.54 percent on Thursday morning, one-tenth of what they lost the previous day.
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