Chapter 96: Mission Accomplished—This Will Work
After hearing Lin Haoran's question, Pao Yue-kong pondered for a moment before replying,
"Another oil crisis? To be honest, I can't say for certain. At the moment, the Pahlavi Dynasty's oil exports are still operating normally, and global crude oil prices remain relatively stable.
"Besides, the Pahlavi regime has the backing of the United States. I don't think those revolutionaries will be able to overthrow it, so the chances of another oil crisis are probably very low."
That was, in fact, what most people believed.
In their eyes, how could a government supported by a military superpower like the United States possibly lose?
What most people didn't know, however, was that although the United States appeared to be one of the Pahlavi Dynasty's strongest allies—primarily to counter the Soviet Union—it was secretly supporting efforts to overthrow the regime.
The reason was simple.
The Pahlavi government had continually pushed for higher oil prices, causing significant economic losses for the United States.
Lin Haoran knew these inside details because of memories from his previous life.
But in this era, such covert operations were naturally kept secret by the United States and known only to a select few.
This was precisely the issue Lin Haoran most wanted to discuss.
"Uncle Pao, let's assume a hypothetical situation.
"If the Pahlavi Dynasty is eventually overthrown and another oil crisis similar to the one in 1973 breaks out, causing crude oil prices to multiply several times over...
"And suppose I happen to have a considerable amount of capital available and want to position myself before prices skyrocket.
"The problem is that time would be too limited for me to physically stockpile crude oil.
"In that situation, how do you think I should operate in order to profit from the coming oil crisis?"
Pao Yue-kong smiled faintly.
"There are certainly ways to do it, and honestly, it's not that complicated."
"Since there are many oil-producing countries, you could choose a reputable and reliable producer as your business partner."
"You would pay in advance to purchase the crude oil, but instead of taking delivery immediately, you'd have them store it on your behalf."
"Then, once the oil crisis truly erupts and crude prices soar, you can resell that oil to petrochemical companies that urgently need supplies."
"That would allow you to achieve your objective."
He paused before continuing.
"However, Haoran, I should remind you that although the idea sounds attractive, the risks are equally significant."
"Do you truly believe another oil crisis will happen?"
"In my opinion, the probability is actually quite low."
"And if the crisis never materializes, while you won't lose all of your investment, you'll still suffer losses from storage costs, the time value of money, and the discounts you'll likely need to accept when reselling the oil."
"After all, you don't operate a petrochemical company."
"Holding crude oil for a long period doesn't create any practical value for you."
In Pao Yue-kong's opinion, the chances of another oil crisis were simply too small.
As an elder, he felt it was his responsibility to guide and advise such a promising young man.
After several enjoyable conversations together, he had grown increasingly fond of Lin Haoran and had high hopes for his future.
Chinese-owned businesses remained at a disadvantage compared to the powerful British-owned corporations.
If Chinese entrepreneurs wished to compete against them, more outstanding business leaders would have to emerge.
Faced with Pao Yue-kong's sincere advice, Lin Haoran returned a warm smile.
He naturally knew with absolute certainty that the Second Oil Crisis would occur.
History's course could not be altered so easily.
Therefore, although he appreciated Pao Yue-kong's concern, he wasn't worried in the slightest.
Instead, he found Pao Yue-kong's suggestion remarkably clever.
Signing a purchase contract in advance, paying for the crude oil ahead of time, and locking in future deliveries—
Wasn't that essentially an unconventional version of an oil futures contract?
The only difference was that it bypassed the futures exchange entirely.
Rather than trading standardized contracts, he would negotiate directly with the oil producer.
It was simpler and far more efficient.
The only remaining challenge...
...was choosing the right trading partner.
That decision would determine the success or failure of the entire plan.
He asked respectfully,
"Uncle Pao, I understand the risks involved, but I've decided to give it a try. Even if I lose money, I can afford the risk."
"In your opinion, if I were to choose one country as my trading partner, which would be the best choice?"
Pao Yue-kong immediately realized that Lin Haoran had already made up his mind.
He no longer tried to persuade him otherwise.
Respecting another person's decisions was also part of being a good elder.
Besides, Pao Yue-kong believed that since Lin Haoran had so much confidence, even experiencing setbacks would become valuable lessons.
After all...
In the unpredictable business world, even the greatest tycoons had risen through countless failures.
A completely smooth journey was something few true entrepreneurs ever experienced.
He spoke gently, sharing his experience.
"Haoran, choosing a business partner is much like choosing a close friend."
"Their credibility, strength, and long-term stability are all crucial considerations."
"My Global Shipping Group has maintained close partnerships with many Middle Eastern countries, especially Saudi Arabia."
"As one of the major transportation partners for numerous oil-producing nations, I'm quite familiar with that market."
"If you're truly determined to proceed with this transaction, I strongly recommend Saudi Arabia."
"They possess enormous crude oil reserves."
"More importantly, they have an excellent reputation."
"Whether the deal is large or small, they value their credibility and would never casually damage it."
"Furthermore, I have a good relationship with the Saudi Arabian Oil Company."
"If you're serious about this, I can introduce you."
A flash of delight appeared in Lin Haoran's eyes.
He silently praised himself for deciding to visit Pao Yue-kong tonight.
Although this meant owing Pao another favor, he didn't mind at all.
In business, exchanging favors was perfectly normal.
Once his own companies grew larger in the future, deepening cooperation with the Pao family would be more than enough to repay today's kindness.
At this stage of his entrepreneurial journey, capital remained his scarcest resource.
He had to seize every opportunity to accumulate wealth.
In an era filled with opportunities, rapidly building financial strength to lay the foundation for future expansion was his top priority.
"In that case, Uncle Pao, I'll have to trouble you to introduce me to the Saudi Arabian Oil Company."
Lin Haoran spoke sincerely.
At moments like this...
The value of personal connections became especially evident.
"A small matter."
"I'll call the person in charge at the Saudi Arabian Oil Company and ask about it."
He smiled before asking,
"By the way, Haoran, how much crude oil are you planning to purchase?"
Lin Haoran thought for a moment.
"Roughly two to three hundred million Hong Kong dollars' worth."
Although he currently possessed HK$63 million in cash, that amount was nowhere near enough for the scale of oil investment he envisioned.
Naturally, he had already planned to borrow the remaining funds.
With the enormous number of Qingzhou Yingni shares he owned, together with his status as the company's chairman, he was confident banks and financial institutions would be more than willing to lend him the money.
Pao Yue-kong couldn't hide his surprise.
"You've just completed the acquisition of Qingzhou Yingni, and yet you're still able to mobilize another two or three hundred million Hong Kong dollars?"
His voice carried genuine astonishment.
He admired Lin Haoran's financial capabilities but, out of respect, chose not to ask about the details.
After all...
Two or three hundred million Hong Kong dollars was no small amount.
Lin Haoran smiled.
"Uncle Pao, capital is the lifeblood of business."
"Without sufficient financial backing, I could never have successfully acquired Qingzhou Yingni."
Pao Yue-kong nodded.
"In that case, I'll contact the Saudi Arabian Oil Company as soon as possible."
"I'll let you know the moment there's any progress."
By now, it was already late into the night.
Their conversation was drawing to a close.
Before leaving, Lin Haoran remembered Pao Yue-kong's willingness to help him and sincerely offered one final piece of advice.
"Uncle Pao, if you're interested in earning additional profits, I truly believe this oil investment is an opportunity worth considering."
"Although there are risks, I believe the risk-to-reward ratio is extremely attractive."
"Even if the oil crisis never occurs, our losses would be limited to transaction costs and resale discounts."
"But if the crisis does break out, the returns could multiply several times over."
"So personally, I think it's a risk worth taking."
However, Pao Yue-kong remained as cautious as ever.
"Haoran, thank you for your suggestion."
"But at the moment, nearly all of my capital is committed to the battle for Wharf."
"I simply don't have any spare funds to take this gamble."
"Still, I sincerely appreciate your reminder and your concern."
It was obvious that Pao Yue-kong had declined the proposal without the slightest hesitation.
(End of Chapter)
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