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Premium Article Archive

  • This is the Oil Trade You Should be Making

    Here it is, in one monumental and telling graph – the point on energy you must remember:Yes, there is demand drop in the US, Europe and Japan but it is miniscule and even 25 years from now will amount to less than a million barrels a day of total liquids consumption. Meanwhile, demand growth from China, India and the Middle East ALONE will increase close to 20 million barrels a day.Now, let me give you a second chart; the one that I believe most energy watchers are relying upon to offset chart number one: Here’s the most graphic representation I’ve…

  • This Natural Gas Giant Is Worth The Risk At These levels

    Chesapeake Energy (CHK) is one of those companies that just don’t seem to be able to get out of their own way. They have been dogged by controversy over the last few years. Those that follow the energy sector will no doubt remember that founder and original CEO Doug McClendon retired in April of last year amid accusations of irregularities surrounding $1.1 Billion of loans that he had taken from the company. This week came the announcement that the Michigan Attorney General was bringing fraud and racketeering charges against CHK, stemming from their practices in acquiring land leases in the…

  • The Countries Most at Risk from Declining Oil Prices

    The oil markets woke up at the end of the summer of 2014 realizing that there was not as much demand out there as they thought. Suddenly, the world is flush with supplies, and there aren’t enough buyers out there to gobble it all up.That has Brent prices at their lowest levels in over two years.The International Energy Agency said that weakening demand for oil worldwide is “nothing short of remarkable.” What is even more remarkable is the blunt language used by the IEA, usually a buttoned-up and bureaucratic bunch.But for the third month in a row the IEA was…

  • Global Energy Advisory - 12th September 2014

    Geopolitical & Conflict UpdatesUkraine•    Ukraine has only about 20% of its oil demand filled at this time, with only 2 of its 6 refineries operating. Typically it buys oil from Belarus, Lithuania, Poland and Russia but is now in talks with Azerbaijan•    Poland has stopped reverse-flow deliveries of natural gas to Ukraine, claiming that Russia has reduced flow of its gas to Poland. The Polish oil and gas corporation (PGNiG) claims that deliveries of Russian gas had fallen 20% to 24% in the past two days, but Gazprom insists that flows remain unchanged. This cat and mouse game has to…

  • Time to Sit Back and Plan Your Next Investment strategy

    With crude oil and crude oil-related stocks exhibiting nearly free-fall characteristics, unless you’re willing to play the short-side after an almost three month sell-off, this week it may be best to sit back and plan your next investment strategy while waiting for the markets to reach strong value areas.This week’s sell-off in crude oil and energy stocks was strong enough to pull the rest of the U.S. stock market down. This is a sign that money managers are beginning to sit up and take notice. Investment managers may have been complacent throughout the year because the liquidity provided by the…

  • Sending the Wrong Message to the Corporate World

    BP today was found grossly negligent in its connection with the 2010 deepwater horizon disaster.  It is a most surprising result and will continue to hang over the head of the company, at least until the amount of the fines that BP will have to pay under the Clean Water Act are finally determined, making the stock – again – impossible to own.  But this isn’t a column about BP. It’s a column about corporate responsibility in the oil patch and what companies can expect  -- even when they have done their utmost to atone for an admitted negligent mistake. …

  • Two Different Uses For Obvious Chart Points

    I am not one to baffle with overly technical analysis when it comes to charts. To me, the more obvious the pattern or point is, the more useful it is. The most obvious and basic points to identify on a chart are support and resistance; the highs and lows that a stock has touched over a given time period. The more times it has bounced off that level, the more significant it becomes.The significance comes in two ways. Obviously, a breakout below a support level, for example, can result in a quick move down, while a bounce off of it…

  • North Sea Spotlight: What Scottish Independence Will Mean for UK Oil

    In a few weeks’ time, the oil in the North Sea could suddenly be under the sovereignty of a new country. Scotland is pushing for a referendum on independence from the United Kingdom, and the September 18 vote is quickly approaching. The nationalists hope to build an independent country on the back of North Sea oil, which they say will help them fund schools, infrastructure, and healthcare. Currently, as a member of the UK, revenues from North Sea oil production are collected by the British government in London. But, if Scotland becomes independent, around 90% of the oil in the…

  • Global Energy Advisory - 5th September 2014

    Regulations & ComplianceA new real estate law in Egypt will require companies to pay taxes on oil fields. The law was amended in late August, but criteria are still being developed by the relevant ministries and there is a three-month deadline for this before implementation, though the Finance Ministry is hoping to speed up the process. The new real estate tax base will apply to industrial, petroleum and tourism industries, along with ports, mines, quarries and similar facilities. With the new amendments, the property tax will be set at 10% of a unit’s rental value and 3% of a unit’s…

  • Exxon Mobil and the Oil Markets

    The price action by Exxon Mobil (XOM) puts this stock on the radar this week. This market is significant because it is a major component of the S&P 500 Index as well as a strong indicator of future price action in crude oil.When comparing the Exxon chart to the S&P 500 chart, one will notice the divergence between the two. Since reaching a top at $95.49 the week-ending July 26, Exxon has sold off sharply, reflecting the strong correlation to the price of crude oil.Even with the broad-based S&P 500 market trading at an all-time high, Exxon has not been…