So, you want to make money this Fall, or what?
Energy Word subscribers have been killing it this year, following a steady plan of patient investing in the energy space.
What have you been doing?
You want some winners? OK — Here are a three that Energy Word subscribers have enjoyed in the past few months:
EOG Resources (EOG) – a quick play to take advantage of a price dip under $100 a share appeared in mid-July. Subs were advised to pair buying shares with a sale of August $105 calls. This resulted in a RETURN of near 20% in only two months.
Cheniere (LNG) – Energy Word subs have had this stock in their portfolios for more than a year, but an increase in holdings was advised near $120 a share in late June. Shares are rocketing past $170 today.
FuelCell (FCEL) – Subscribers just waved goodbye to FCEL shares, a high-beta hydrogen play we’ve used with covered calls to generate a 145% return in premium and stock appreciation in a little more than a year.
Want more? There are many, many more………..
Here’s a partial preview (minus the stock picks) of the last ALERTS message I sent my subs on Tuesday, showing the current enormous disconnect between oil prices and oil stocks — and telling me that perhaps the BEST opportunities in oil and gas stocks are YET TO COME.
Read it and then ask yourself – Do you want to make money this Fall, or what?
https://dandicker.com/subscribe/
What’s wrong with this picture?
That’s not a hard question to answer: Two things that should be all but connected – crude prices and Exxon-Mobil stock – have become disconnected.
That tells me a lot, but first and foremost, it tells me that one of them is “wrong”. Either oil prices are too low for what is going on in the markets right now, or Exxon stock is too high.
You know what I think, but lets look at both a little more closely, and dispassionately:
First, Exxon: It’s just had it’s best quarter EVER. Six years of very tough changes in Capex and production guidelines and RoE shareholder discipline has led to a $112 billion quarter with oil prices around $100 a barrel during that time. That’s impressive – and one would think worthy of $95+ share prices, probably a lot more.
Now, Oil: It’s had a very weak quarter, seemingly in a ‘bear’ market, having done nothing since early June but drop. In my view that’s been because of two factors: One, the overwhelming fear of Recession in the overall markets destroying demand and the also slow but consistent withdrawal of hedge fund money from futures who have been betting on a better upwards trending market during the summer and gotten punished for it.
Neither of these factors are fundamental – both are predicated on predictions and emotions, not on anything fundamental. For fundamentals, the oil markets look as poised to go higher as they ever have. Europe remains in panic mode about energy because of the withdrawal of Russian supplies and are looking at all options, including coal. For now, renewable hopes are out the window. OPEC is not about to take lower oil prices lying down, and has threatened to install a cut if markets continue to soften. That would have a fundamentally immediate impact, as supply is already not meeting demand and OPEC is also already 3 million barrels a day behind production increases they’ve already promised the markets.
While the EIA and OPEC both seem to be playing the game of small expectations, there are a few analysts who’ve figured out what’s going on here – and I wrote about Jeff Currie and Goldman Sachs in my last letter.
Currie was very clear in a recent GS podcast of just how bullish he is on oil, going so far as to say that even a RECESSION is nothing but a short-term roadblock to the ‘superspike’ oil prices he expects (and predicted once already correctly in 2003). Nothing, he says (and I definitely agree) stops the supply crunch in oil that’s coming like a freight train, other than massive investment in fossil fuel production, something that oil companies have been way behind on since 2014.
Some private equity is finally figuring this out – that OIL AND GAS will still be a major part of the energy portfolio for decades to come – and is starting to invest. But it is still a comparative trickle, and does not significantly change the superspike scenario over the next 2-3 years that Currie and I are expecting.
