• 4 minutes Why Trump Is Right to Re-Open the Economy
  • 7 minutes Did Trump start the oil price war?
  • 11 minutes Covid-19 logarithmic growth
  • 15 minutes Charts of COVID-19 Fatality Rate by Age and Sex
  • 18 minutes China Takes Axe To Alternative Energy Funding, Slashing Subsidies For Solar And Wind
  • 5 hours Dr. Fauci is over rated.
  • 16 hours Dept of Energy ditches plans to buy Crude Oil for SPR
  • 46 mins China extracts record amount of natural gas from Gas Hydrates in South China Sea
  • 2 hours Western Canadian Select selling for $6.48 bbl. Enbridge charges between $7 to $9 bbl to ship to the GOM refineries.
  • 5 hours Where's the storage?
  • 1 hour TRUMP pushing Hydroxychloroquine + Zpak therapy forward despite FDA conservative approach. As he reasons, "What have we got to lose ?"
  • 2 hours Oxford Epidemiologist: Here’s Why That Covid-19 Doomsday Model Is Likely Way Off
  • 1 day Trump to New York - DROP DEAD!
  • 16 hours Wastewater Infrastructure Needs
  • 24 hours Analysis into the Iran Outbreak
  • 17 hours >>The falling of the Persian Gulf oil empires is near <<

A Contrarian Strategy For Those With Healthy Risk Appetite

Next week is a huge one for energy investors in terms of earnings. Four of the largest multinational integrated oil firms will reveal earnings for the third calendar quarter, beginning with BP (BP) on Tuesday. Conoco Phillips (COP) will then report on Thursday, closely followed by Exxon Mobil (XOM) and Chevron (CVX), both on Friday. It is no great revelation to say that the news is likely to be bad in a comparative sense. Oil closed the last quarter at $45.35, as compared to the third quarter last year when it was at $103.70 on September 30th, or the close of the second quarter, which was $59.10.

Given that, relating the last quarter’s performance to historical numbers for any of the big four will be a pointless exercise. What matters to most people is how the companies perform relative to analysts’ consensus estimates, and they will be looking for results that are “not as bad as it could have been” or for positive, or at least less negative, guidance from the big four.

For those invested for the long term, of course, one quarter’s earnings are not the point. They are counting on a recovery in oil prices and thus in profitability for these companies, over time. Those of us with a shorter term trader’s view, however, see the volatility that usually accompanies earnings as an opportunity. In order to take advantage of that opportunity, my advice would usually be to do what I was trained to do in the dealing room; square up before…




Oilprice - The No. 1 Source for Oil & Energy News