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Premium Article Archive

  • Readjusting Targets And Preparing For The Next Oil Boom

    Nothing in the past two weeks has changed my outlook on oil and oil stocks in that I believe this 'bust' cycle which started in August of 2014 still has a long way to go.  But various financial factors are beginning to pick at the outskirts of the numbers and begging us to reevaluate some targets as we position ourselves for the next great oil boom. We've isolated several financial factors, having little to do with fundamental oil, that are affecting the current price of oil, especially the dollar which has looked somewhat toppy of late:   This has added to…

  • AGL Resources (GAS) is A Risk Worth Taking

    When the price of oil was in freefall it understandably captured a lot of attention. The same fate befalling natural gas, however, was of less interest to most media outlets. In many ways that is understandable; the price of natural gas has a much less direct effect on the vast majority of consumers than that of oil, so stories about it don’t drive ratings. The fact is, though, that the decline in natural gas prices was, if anything, more spectacular.When oil was in full decline from September to December of last year natural gas prices held up pretty well, supported…

  • Fortune Favors The Bold, Especially In Iran

    Introduction The tentative framework deal reached between Iran and the P5+1 nations over its nuclear program has raised the prospects of a broader thaw in relations. If Iran can be accepted back into the international community, the harsh sanctions on Iran’s economy could be lifted. That could lead to an opening up of Iran’s oil sector. While that won’t mean a return to the pre-revolution days before 1979, it could result in extraordinary opportunities for the few international oil companies willing to brave the political risk. Massive Oil and Gas Reserves And the bounty could be big. Iran is sitting…

  • Global Energy Advisory – 24th April 2015

      Deals, Mergers & Acquisitions • With the flurry of speculation surrounding Shell’s designs on BP Plc, BP’s chief executive, Bod Dudley, is trying to head off rumors. Dudley has told the Financial Times that big isn’t necessarily beautiful. “We’ve got a good portfolio, I like our portfolio. We will see. I don’t see the forces at work for lots of consolidation unless the oil price stays down for some time.” BP is apparently concerned about an opportunistic takeover and has increased internal reviews of takeover scenarios and begun drafting defense strategies with advisers. This follows Shell’s £47 billion offer…

  • Trend Should Remain Up Despite Trader Indecision

    June Crude Oil futures posted an inside move last week. This reflected trader indecision or that traders are waiting for fresh information. There was very little reaction this week to the supply and demand reports. Traders seemed to be more focused on the escalating situation in Yemen.After posting a solid gain the week-ending April 17, crude oil futures settled into a sideways-to-lower trade. The inability to follow-through to the upside after the strong rally gave investors an excuse to pare positions. This led to a steady decline throughout the week. It also was an indication that traders were looking for…

  • The Difference Disciplined Trading Makes

     I love it when the trolls come out of hiding, as they have this last week, specifically to rag me for ‘missing’ the last rally in energy stocks. Trolls have the best vantage point to pick stocks; they’re anonymous, never wrong, always up money and tend to disappear when their cheap seats commentary turn out wrong. I don’t have any of those luxuries. Fortunately, I do have 25 years of experience in the oil markets successfully trading oil and oil stocks – even yesterday as I filed my taxes and despite being outrageously wrong about the massive collapse of oil…

  • An Unlikely Entry Point For Some Long Plays

    Last week, as earnings season began, I suggested a few plays that, at the time looked a little risky. I mentioned four stocks as possibilities, Halcyon (HK), Exco (XCO), Continental (CLR) and Devon (DVN). The first two looked viable on the basis that all of the bad news about earnings was priced in, and the others were a play on the possibility of acquisition rumors. The takeover scenario hasn’t played out yet, but a reaction to slightly higher oil and some early “not as bad as it could have been” Q1 earnings in the energy sector have given all four…

  • Falklands Present A Unique Opportunity To Smaller Players

    IntroductionArgentina has started to make a name for itself in the oil and gas world due to the vast reserves located in the Vaca Muerta shale region. If successfully developed, Argentina could become the first major shale producer outside of North America. But just off the coast of Argentina in the Atlantic Ocean is another budding oil and gas region. Although it is not Argentine territory – this is a very sore subject – this area could also be another source of new oil and gas production. The Falklands (or as Argentina calls them, Las Malvinas) are a group of…

  • Global Energy Advisory – 17th April 2015

    The Geopolitics of Oil The Iran-Pakistan Pipeline The Iran-Pakistan pipeline, which has been languishing on the Pakistani side, looks set to get a boost from China, which has apparently agreed to take on the $2 billion Pakistani pipeline segment. If this deal goes through, the Pakistani segment of the pipeline, which is 485 miles, would be funded largely by a Chinese loan and construction would be undertaken by China’s CNPC. Iran has already completed its 560-mile segment of the pipeline. Pakistanis say the deal with China is expected to be signed during a presidential visit to Islamabad this month. That…

  • Investor Sentiment Could Be Shifting

    A drop in U.S. crude oil production helped drive futures prices higher this week. There is even evidence of renewed hedging in the deferred futures contracts that suggest the bottom has been made. The slowdown in U.S. crude oil production is the key to sustaining the rally since excessive production was the driving force behind the tremendous price slide. The recent inventory figures suggest that cutbacks in oil production and oil exploration may finally be taking hold. U.S. production fell for the second time in three weeks and refinery runs are spiking higher indicating increased demand. Market participants seem to…