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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…

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Tipping The Balance: The $50 Sweet Spot

Eagle Ford

This week, an update on an investment I recommended last year in late May – Silver Run Acquisitions Corporation, then the SPAC of ex-CEO of EOG Resources, Mark Papa. That SPAC morphed into an 89 percent controlling investment in Centennial Resources (CDEV), with Mark Papa taking the helm at the Permian shale company. So far, the initial investment has paid us very, very well indeed, as the initial investment of shares has converted into a near doubling – from the original $10 rollout of the SPAC to the current share price in Centennial over $18. But on top of this, shareholders of Silver Run also gained warrants in the conversion for another approximately 1/3 of total shares at an exercise price at $18 a share.

And here, we have a great opportunity to talk about where crude oil is, where it’s going, and whether this piece of the Silver Run/Centennial puzzle is a do or a no do.

In the last few days, we’ve seen the rapid selling of energy futures, which we all noticed were well-nigh overrun with long positions. Here at the oil and gas insider, the ‘numbers game’ authors who write below my column did a tremendous job of showing just how strong the speculative long positions were in crude, in this case almost as deep a ratio as we’ve ever seen.

And as those energy futures unravel, today under $50 a barrel, we have to take a good hard look at how we’re going to manage our energy stocks – and specifically the case of the Centennial warrants, needing an answer later…




EXXON Mobil -0.35
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BUY 57.15
Sell 57.00
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