U.S. shale drillers are struggling…
As OPEC struggles to tackle…
Gartman has done it again, and luckily, the following "advice" does not require much in terms of commentary. It was, as Gartman might perhaps say, to be expected in self-explanatory terms.
From yesterday's, November 30, Gartman letter:
In all, it is a guessing game what shall eventually come out of today’s final meetings, but as noted above some sort of agreement has to be put forth or OPEC is indeed finished, if it is not finished already in light of the U.S. shale industry’s advances. We are short of crude oil from yesterday; we’ll have stops on those positions on a closing basis this afternoon here in the States, with the intention of adding to those short positions once the OPEC meeting is behind us. We’ll wait until at least tomorrow to add to the positions and we may wait until Friday perhaps.
And then the follow up, from today, December 1:
Crude oil prices have rather obviously soared and we were rather obviously wrong in having sold crude oil short the day before the “official” OPEC meeting. We are still egregiously suspicious of the ability on the part of the various OPEC members to truly adhere to the production cuts announced, but time only shall tell if our concerns/expectations for OPEC’s ability to remain unified in its intent shall prove correct. For the moment, there is unity… with the operative words here being “for the moment.”
Clearly we were wrong/early/ill-advised in being short of crude one day before the official OPEC meeting but clearly too we remain suspicious of the cartel’s ability to keep its members aligned. Clearly we shall err bearishly of crude, but not for the moment, but perhaps later this month… perhaps.
As a reminder, WTI soared over 9% yesterday, its biggest one day move since February. To all those who "erred bearishly" alongside Gartman, and were suckered into going short just as we warned on November 29...
... our condolences.
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