• 5 minutes Rage Without Proof: Maduro Accuses U.S. Official Of Plotting Venezuela Invasion
  • 11 minutes IEA Sees Global Oil Supply Tightening More Quickly In 2019
  • 14 minutes Paris Is Burning Over Climate Change Taxes -- Is America Next?
  • 51 mins Waste-to-Energy Chugging Along
  • 5 hours U.S. Senate Advances Resolution To End Military Support For Saudis In Yemen
  • 5 hours Contradictory: Euro Zone Takes Step To Deeper Integration, Key Issues Unresolved
  • 1 hour Venezuela continues to sink in misery
  • 34 mins Let's Just Block the Sun, Shall We?
  • 2 hours What will the future hold for nations dependent on high oil prices.
  • 17 hours Regular Gas dropped to $2.21 per gallon today
  • 15 hours Zohr Giant Gas Field Increases Production Six-Fold
  • 14 hours No, The U.S. Is Not A Net Exporter Of Crude Oil
  • 10 hours UK Power and loss of power stations
  • 1 day $867 billion farm bill passed
  • 1 day Air-to-Fuels Energy and Cost Calculation
  • 23 hours USGS Announces Largest Continuous Oil Assessment in Texas and New Mexico
  • 11 hours EPA To Roll Back Carbon Rule On New Coal Plants
  • 16 hours Global Economy-Bad Days Are coming
Dan Dicker

Dan Dicker

Dan Dicker is a 25 year veteran of the New York Mercantile Exchange where he traded crude oil, natural gas, unleaded gasoline and heating oil…

More Info

Avoid These ‘Shale Legends’ For Now

rig

The Fed continues to dominate the markets and our trading in oil and oil stocks.

God knows there are hundreds of writers out there with opinions on the next move for rates, so mine would only be so much more noise. Instead, let’s just acknowledge that the market is more likely than not to drag for the next several weeks, and thank our recent discipline in keeping our portfolios safe.

Let’s also notice some recent news that convinces me that our investment discipline will be well served for a long time to come. Oil stocks have in many cases, run ahead of Oil, the commodity – as these examples will show:

First up, the EOG Resources (EOG) purchase of Yates Petroleum for $2.5b in mostly stock. This strikes me as a prime example where the current disconnect in oil prices compared to shale oil stocks has made me wary of increasing positions, even selling majority percentages of long-term positions in many of my most favored E+P’s, including EOG. Add to this the even more exuberant froth that is persistently seen in those E+P’s who have a majority interest in the Permian formation, and even more specifically in the most Western Delaware basin. We have benefited from this ourselves, as our holdings in Silver Run Acquisitions, now acquiring its interest in Permian player Centennial, has rocketed (prematurely) above $16 a share, although is tempering itself.

Don’t call me bearish on oil, or bearish on the Permian – I…

To read the full article

Please sign up and become a premium OilPrice.com member to gain access to read the full article.

RegisterLogin

Trending Discussions




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