Recent Posts

Morning Succinct

Great guest tomorrow, especially as everyone is asking about natgas. Robert Raymond, private equity wizard, the man who gave us our Antero bull stance which he had when the stock was a toddler in 2020. Mr. Raymond is the founding member of RR Advisors LLC/ RCH Energy. He joined Crow Family Holdings in 1994 and subsequently built and managed their energy investment program from 1997-2004. Mr. Raymond oversees all aspects of RCH Energy investment platforms […]

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8:45 AM

Sunday Shares & Sheeran

Greetings from Texas, The world’s biggest mangrove company kindly invited Paty & me to the Austin Formula One Grand Prix (F1). Cars running E10 are screaming behind me on four source power trains; (V6 1.8 liter, one electric exhaust powered, one electric latent braking powered, and a turbocharger). The world’s biggest mangrove company is Aramco, F1 primary sponsors for this race. I think the sponsorship is genius in increasing the popularity of the world’s greatest […]

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4:19 PM

Saturday Stop Glue (Oil Product)

Yullo from London, Today a look back at the past week in London, tomorrow a short Sunday look forward: Best line of the week, from major energy transition fund in London. “Our client mandates are extremely ESG-conscious, like University superannuation funds, yet nowadays we are allowed to own oil & gas stocks… But we absolutely cannot lose money in them. We can be long First Solar and lose a ton, that is fine by the […]

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3:44 PM

Morning Idi

Gossip from dinner with my London lawyer friend who is familiar with, let’s say, “emerging markets law”: Russia’s power rests between the Oligarchs who have the money, vs the military, that have the weapons. The single crossover oligarch, who controls the military, is Putin alone. Can the oligarch class form an ex-Putin alliance with the military? Difficult. Rational analysis of Nordstream pipeline explosions, which logically would conclude that Poland done it, with NATO deep state […]

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6:28 AM

Morning Lettuce

Greetings from London, Noted, more buyback? Less capex? How about a stealth capex deal, Diamondback for “closely held private” Firebird. Diamondback’s addition of adjacent drilling locations in the Permian underlines that the US oil bonanza has turned from growth to productivity – world oil supply is structurally challenged, “even in the Permian”. The price looks reasonable, even in the context of Diamondback’s own stock price, the point being, where does this sit with their net […]

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7:37 AM

Sunday Primrose Hill

Greetings from London Town, The Giants and Packers fans were out in numbers around the West End – I can’t believe the Giants won! My daughter Honor is the expert – her line was that the Giants might be the best-coached team in football. She is deeply cynical about the team, so, powerful words. By the way her life ambition is to be a CEO, and a Giants Season ticket holder. Meanwhile in the pub […]

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5:28 PM

Saturday Sunday Sankey

Your correspondent is flying tomorrow at 7am La Guardia to Houston for Steve Chazen’s Memorial at 2pm assuming flights co-operate, and so this week’s Sunday is here on a Saturday; a brief highlight reel, or should that be “bloopers” “fails”, and “cringe” in this tape. From the UK pound, to Japanese Yen, to Credit Suisse credit default swaps (CDS) this is a market at war with itself, quite literally. The incredible sabotage to the Nordstream […]

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7:58 PM

Afternoon Theories

This evening! Premium Event! Steve Levine on Happy Hour tonight at 5pm ET re: batteries and electric vehicles, he is a world expert. Biography was emailed to you yesterday, impressive. Steve is now Editor of The Electric, a new, exclusive premium publication at The Information on batteries and EVs. Steve Levine 5pm Thursday 29th Sept: https://us02web.zoom.us/meeting/register/tZwtduuvrDMqEta4M3eKkusntGrE1nVV2HoK ~ Watching the NASDAQ below its 200 weekly moving average for the first time in 13 years “The West” […]

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3:20 PM

Sunday Calm Before

We mourn the passing of Steve Chazen on 23rd September, he will be remembered as a legend. It was a privilege to have known him. Rest in Peace. We wrote the History of Oxy in December 2021, which includes the almost 30 year impact of Steven Chazen (joined in 1994, died as Chairman 2022). ~ Bill Bishop at Sinocism: For those who have not heard the rumors, Xi [Jinping, China President] has been supposedly removed […]

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5:54 PM

Sunday Gold Delivery

Fed decision this week. TINA is dead. Nothing big in earnings this week, Fedex reporting Friday has warned, in case you totally missed last week; if you did, you missed the largest stock market move on an economic data point, in history Rules of Wall St series: Always short the new CEO of a highly rated stock. Not in the news: Iran’s Supreme Leader said to be gravely ill – watch for upheaval ~ Fed […]

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6:19 PM

Morning Tape Bombs

Refining getting worse LNG export developer Tellurian whacked as it struggles to finance “by mid-2022”. It’s Q3 2022. As the share price falls, financing from the at the money issuance facility becomes even more problematic. Macro influencer Luke Gromen on Happy Hour Fedex profit warning Fiscal 2Q23 guide $2.75 vs cons $5.46 (!!!) Xi-Putin As we feared refining is getting worse. China export quotas as we highlighted yesterday have further pressured weak Asian margins that […]

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8:41 AM

Morning Mr Gromen

Dollar vs oil correlation has moved back to inverted very recently. Right now, the oil price is winning, US$ weakening. For the first time in well over a year, media is stating the oil price is rising on a weakening US$. That’s a bit like saying the NY Giants are dominating the NFL – after winning their first  game of the season. WITH THAT SAID Luke Gromen, high profile strategist, is on Happy Hour this […]

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8:15 AM

Sunday Grey

It was a week that started with the Queen accepting a new British Prime Minister, and ended a new King Charles III and the always-somber 9-11. It is a miserable late summer day in New York, drizzle from a windless grey sky. With due respect, there is not a lot in those events directly relevant to oil/energy, and no doubt the last thing you need is more coverage from me. Rather, there is lots of […]

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4:48 PM

Sunday Life Guard

Labor Day outlook for oil and energy markets into year end; there is plenty more research to be done. You could make a big call on oil today for the next four months, and be wrong by Tuesday this week, with OPEC+ meeting Monday. If they cut and crank oil prices, you could make a bear call today, reverse your view on Tuesday and be wrong by Thursday when the ECB may be pushed towards […]

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8:32 PM

Midday Verb

Happy Hour this week with Michael Lynch, absolutely tenured energy analyst. Michael can explain the last time California had an EV mandate and why it  bombed, he had a good article in Forbes this past week about it. Long time MIT, totally established energy expert. I will be chatting to him, and if the attendance is graveyard slot (this Thursday evening before Labor Day weekend) I will persuade him to return. Mike Lynch President at […]

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1:29 PM

Sunday Salads

So we made it to the Wall Street’s vacation week, the last week in August. What’s the first rule of Wall Street? Keep your seat. We got through another year. Congratulations. Three observations about what the market might be missing: Is Putin’s EU squeeze a pre-cursor to him suing for peace/settlement in Ukraine? European energy prices are insane, but the futures strip is self-defeating Drought in China is epic – the scale may be under-appreciated […]

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5:31 PM

Sunday Mega E&P – and Fred

So I am back in Brooklyn after vacation (Nizuc Resort, Cancun), needless to say muttering and grumbling to myself. We left some calls hanging before the week away, updated in this note. It was a week this past week where performance reverted to year-to-date performance (see first chart);  we are still bullish US natgas, led by AR, bullish Oxy led by Warren Buffett, bullish the US oil sector on the structural improvement in the companies […]

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4:02 PM

Morning Nizuc

One of the many lessons of Wall Street, is “don’t expect any sympathy”. This is more sharply put: “If you want a friend, buy a f#^@*# dog.” I’ve got two dogs. As I have been proclaiming, this is a long summer. We don’t have Labor Day until September 5th, and with me stewing nicely in Brooklyn with the dogs, thinking of what fun the run is from Labor Day to Christmas, to be in NYC […]

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7:35 PM

Morning Pain Trade

Delighted to say that Dr James Henderson is on Happy Hour Strategy Session tonight, A PREMIUM EVENT. Jim is currently Senior Research Fellow at the Oxford Institute for Energy Studies, alongside his consultancy work and professorships. When: this evening, Aug 11, 2022 05:00 PM ET, Zoom, Register in advance: https://us02web.zoom.us/meeting/register/tZ0sd-CtpjsrGdVM0p-MsG1P4WU0dr3hBWq3 ~ One of my favourite concepts on Wall St (or should I say hated?), is the “pain trade.” I first heard of it 20 years ago and […]

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10:09 AM

Sunday CRC

I asked a major activist investor if I should zip over to Denver this week for the Enercom conference, (starts tomorrow). It’s a staple of the August energy conference diet, which is not a rich diet. Enercom, you pay to attend and a plethora of smaller oil & gas exploration and production companies make presentations with meet & greet. I’ve been once and a client told me as I headed there, the first time he […]

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11:41 PM

What are you doing? Reading transcripts

The two weeks, mid-earnings, when we pull together company results transcript comments, are not a science, they are an impressionistic art; a colour to our themes. Basically these are comments that caught our eye over the past week. Like sellside analysts, the companies tend to all present the same more-or-less generic message, but occasionally, as we strive with Sankey Research, a comment stands out, is differentiated, or so wild that it is worthy of note. […]

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2:25 PM

Morning Homing Pigeons

Canada from the top rope with the 100bps interest rate rise. US with the 9.1% inflation print. Here’s US inflation since 1914. We argued that the 2020’s have nothing like the set up of the “Roaring 20’s”, in our note written in 2020 “The Cliché-Myth of the Roaring 2020s”. For one, the stock market to start the 1920s had been essentially in a bear market for 15 years, hammered by WWI and Spanish Flu. Not […]

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8:54 AM

Morning China dis-inflation (to inflation)

Rampant inflation globally, underlined by today’s US CPI print has an extraordinary backdrop – China has been dis-inflationary. In certain key markets, notably crude oil and above all LNG, China demand has been negative at the margin in terms of demand growth, with significant roll-overs from previous rampant import growth. Assuming China works through its COVID issues and pursues its 2022 GDP growth plan, a re-acceleration in demand for key commodities seems certain, particularly in […]

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12:03 PM

Private vs Public, Cash vs Multiple

Libya down by 1mb/d, maybe President Biden should visit? APA (Apache Oil) duster in Suriname is unfortunate for the marginal mega-bull case BP – like Shell, the non-alcoholic beer of big oils – sells out of Canadian Oil Sands but increases exposure to Western Canada offshore OKLAHOMA CITY, June 14, 2022 /PRNewswire/ — Continental Resources, Inc. (NYSE: CLR) today announced that its board of directors (the “Board”) has received a non-binding proposal letter, dated June […]

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8:34 AM

The Texas Power Parasite: Bitcoin

We have postulated, for example in our note on Dr Copper (Sweet Chile & Mines, Jan 2022), that China’s total dominance of global primary commodity processing, would eventually force the US and Europe to re-domicile supply chains and manufacturing industry. Having massively and excessively out-sourced energy and commodity-intense industry to China over the past 15 years, the world, not least the US & EU governments, are now recognizing the need to re-domicile core production, back […]

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2:58 PM

Early June Sunday

June, A beautiful day here in Brooklyn Heights, I wish you a wonderful Sunday. I always maintain that if you ignored the media, you would think it’s a wonderful world. And it is! That said, I am enjoying the mass media coverage of the Jubilee. BREAKING NEWS: QUEEN WAVES FROM BALCONY. Headline on my screen here. And we are kicking ourselves for not being in London, given my mother lives right on Hyde Park, in […]

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3:05 PM

The Only Hawkish Central Bank: Saudi

Concerns that Russia may go ex-OPEC+ quota system, system such as it is, have seen oil prices fall hard this week… from $120/bbl to $113/bbl Brent. The chart continues to look extremely powerful, and I was pondering this morning what happened to all the “Peak Oil” community – which was huge in the 2000s, arguing that we were out of oil supply. Of course, US unconventional oil production growth humiliated them, none of whom forecast […]

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9:26 AM

Sunday Gündoğan

A couple of weeks ago, we highlighted that week ahead as being packed with high multiple growth stocks that could airdrop. And airdrop they did, led by the notorious Upstart, made viral by the analyst live on CNBC who pretended to have an audio problem when pitching the company bullishly, then being asked what Upstart actually did. “I’m sorry… sorry… you’re breaking up…” hilarious. He then compounded the error by furiously posting a video on […]

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4:30 PM

Good times in the right places

Happy Sunday in May, Never a bad thing. Fog this morning has lifted. Aramco results this morning rounded out a week when it became the largest stock in the world by market capitalization, surpassing Apple (not by free float, the Saudi government owns 94%). It  generated an enormous profit in a quarter when Brent averaged just about $100/bbl (actually $99.53/bbl Q1 average).   Refining earnings, as well as continued huge upstream earnings, will be even […]

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3:56 PM

Fear of Market Collapse (FOMC) Day

Sankey Strategy Session tomorrow evening: Bob Jonke, Oil trader for Engelhart CTP and Kathleen Kelley, Oil Market Expert aka “the OPEC Whisperer”. When: May 5, 2022 05:00 PM ET, Register in advance for this meeting: https://us02web.zoom.us/meeting/register/tZcofuqprzMuHd0CDoGbkzN6CiapFAdCg6k2 The Strategy Session this week will be in the context of what will be an extremely low-key OPEC meeting tomorrow with no press conference. Why no press conference? No comment on Russia. Simple as that. Bloomberg 5/4/22 The European […]

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8:14 AM

May Day Sunday Sankey 5/1/22

Happy May Day Sunday, Today in partnership with Greg Bordelon of Isentropic Capital, we publish a note on natural gas markets by way of thesis overview to a theme that we will continue to pursue. The note is long graphics, and particularly interesting on US markets. If you only want to read half, read the second US half. It is as noted graphic intense. European gas markets are fundamentally far more un-analysable than US right […]

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2:48 PM

Sunday Sankey

Quick read today as you got a longer note yesterday on LNG, and I am running late. Just pictures today, and Betsey asked to be on the cover of the Sunday Sankey so it’s a presentation. All the fun favourite charts. Key slides: next week’s earnings highlights starting with Valero. Relative performance, oils performance, high free cashflow yields, and a cash return chart that will be updated on a rolling basis through earnings. Earnings calendar […]

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5:46 PM

Sunday Philosophies

Greetings from Maryland, With limited computing power at my disposal, and having been in thought since watching Elon on Thursday give a TED interview, followed by self-identified philosopher Alex Epstein on our Thursday Strategy Session, a couple of days off, a stroll in Annapolis, this is note is more ideas in 1,000 words, to make a picture, than pictures worth 1,000 words. No demand destruction because there is nowhere to go to substitute Therefore self-compounding […]

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12:48 PM

Life and taxes

Strategy Session Tonight 5pm ET Alex Epstein “The Moral Case for Fossil Fuels”. Next Thursday 5pm Gordon Shearer, Poten & Partners, on Global LNG, save the date. Investment themes: long refining, long US oily E&P; rushing to do more work on US natgas but have loved Antero as our play; Tourmaline interesting, Energy Transfer interesting. Worried about oilfield service earnings upcoming, but clients want to buy them on operating leverage and global oil & gas […]

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8:14 AM

Tilting at Windmills

Well, that was quite the Q1 2022! But we got it in the books. I think the low point of Q1 for me was the evening of Thursday 3rd March, shortly after the 24th February Russia-Ukraine invasion, when the largest nuclear plant in Europe, Zaporizhzhia, appeared to be under direct attack and burning, right as I had a one-hour briefing with the State Dept, and my contact told me that surviving a nuclear attack is […]

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11:52 AM

$200/bbl by next Friday (disty)

Key messages from Strategy Session with Kathleen Kelley: Oil supply crisis – you ain’t seen nothing yet. The oil market is trading very physically right now, making price discovery more volatile. Watch for distillate markets, which are pricing like crazy, with particular volatility (upside) likely next Friday on expiry – we can see (Sankey says) $200/bbl on expiry of the April contract 31st March, the same day as OPEC is expected to disappoint. Kathleen boldly […]

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8:42 AM

Kazak Whisperer

Kathleen Kelley, “OPEC Whisperer” tonight on Happy Hour. Additionally in the following weeks we have two major refining CEOs ready to talk about oil markets. 3/24, 5:00PM EST – Kathleen Kelley 3/31, 5:00PM EST – Delek CEO | Uzi Yemin 4/7, 5:00PM EST – PBF CEO & CFO | Tom Nimbley and Erik Young You can participate on application, but if you don’t pay Sankey Research, why would you ask? If you want a charity, […]

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8:57 AM

Sunday Overtime

Extremely busy this weekend, juggling Patricia wanting to go spring-time walking dogs and window shopping in (packed) SoHo, and me wanting to solidly sit in front of the TV watching March Madness while making bets online. Somehow she does not see the appeal of watching seven games of college basketball back-to-back over seven hours. Of course, she wins. I did snag North Carolina to win it all at 50-1 BEFORE they beat #1 seed and […]

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2:35 PM

PBF is the new Oxy

Friday joke in serious times: yesterday a “Stop Oil” pitch invader interrupted the Everton-Newcastle (Saudi-owned) Premier League soccer game by attaching himself to a goalpost mid-game. An additional 17 minutes of extra time played. The joke? What does he think the zip tie that he used to attach himself with, is made of? Yep, he used an oil product. While wearing plastic glasses. He should have used rope? So much more inconvenient. Client question of […]

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8:16 AM

You are the champion, Pasha

Tonight Strategy Session with Jan Stuart, Cornerstone Macro global energy economist, on oil markets. Zoom call, 5pm. Kathleen Kelley is busy, unfortunately for us, happy for her, she is hosting a St Patrick’s Day party. God Bless Ireland! My paternal grandmother was from Cork, Ivy Sankey (nee Jefford). We have an oil trader joining to ask questions. A real live, oil trader. In the early 1990s, Jan was my first colleague at the IEA in […]

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8:41 AM

Nickel Back, Not

Up bright and early this morning, I will miss “the clocks going forward” now that, as the world ponders World War III, the US Congress has addressed the urgent issue of daylight savings time. The big picture remains that the Democrats are headed for a shelacking in the November 2022 mid-terms and the legislative potential for a major offset victory for the Biden Administration before then is getting very tight. Kudos to Biden for the […]

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9:18 AM

Silver Linings

Emailed question from DC this morning: I’m so confused – why is Brent now below $100??? I thought it would just keep rising and rising! Sankey: Shenzen shutdown is the big one. Also deeply discounted Russian oil coming to market. Also emergency stockpile releases. Also seasonally weak time for demand. In other news, the scale of Devon’s airdrop yesterday relative to a weak sector gives rise to chatter that an M&A deal is coming (and […]

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8:55 AM

TINA Turner

“Only the dead have seen the end of war” – Plato (Attributed). The Quote is writ large at the entrance of the Imperial War Museum in London, one of London’s great museums, if lesser known. Recommended. Thoughts & prayers with the suffering in Ukraine. Peace in Brooklyn, the weather our worst direct concern. The hard yards, I always say from my First World Wall St perch, are January 1st through to March Madness. And today, […]

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4:17 PM

Trade: Buy Tech Short Oil & Pray for Peace

There have been massively structural changes as a result of Vladimir Putin’s disastrous invasion of Ukraine. In the short term we believe that negotiations for peace are more advanced than seemed to be the case yesterday morning. We also received intelligence that the loss of a disproporionate number Russian commanders, starting, it was said, with the Chechen death squad sent to assassinate Ukrainian President Zelensky, who were apparently “neutralised”, indicates that elements of the Russian […]

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8:43 AM

The Big Shot

Big Shot, Big Short moment. Nickel suspended at $100,000 per tonne on the London Metal Exchange. That means that today a Nickel (5c coin) is worth 12.5c, given it is 5g in weight and 25% nickel. The other 75% of a Nickel is copper, by the way. It’s being reported that Chinese entrepreneur Xiang Guangda – known as “Big Shot” – had a large short position on the LME through his company, Tsingshan Holding, the […]

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8:42 AM

Context: Most Extreme Prices

The following chart shows the spot price this morning of key commodities, vs their average price 2010-2019. That is, where is the greatest shock. Most extreme of course, to an extraordinary extent, is European gas. As a fixed asset market with certain major structural limitations, notably Germany’s total lack of LNG terminals, this will take years to fix, although restarting German nuclear would reduce gas use in power generation. Biggest recent suprise and enormously out […]

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7:53 AM

Sunday CPC

In the drama of the week, we never got to publish the dreaded and yet celebrated “Sankey Porcupine” charts that reveal the key message from two analyst meetings last week, Chevron and ExxonMobil, in four charts: capex and volume targets. We do that in this note, and cover Chevron risk in Kazakhstan. Do NOT try to pick the top in this oil & oil equity market; there could be a long way further up to […]

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2:32 PM

Deep Thought

After a very enjoyable Strategy Session with the impressive Kimmeridge Team yesterday, I had a one hour debrief with a Senior US Government Official with long energy experience yesterday evening: Notes from deep Washington source. Watch out for oil exports from Chevron’s Tengiz, reports that 3 cargoes (of 3 tendered) were unsold yesterday. The oil is transported from Kazakhstan across the CPC pipeline in Russia and mixed with Russian crude before loading at a Russian […]

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8:54 AM

Morning Strategy 3/3/22

Strategy Session Tonight, Mark Viviano & Megan Hays of activist Kimmeridge. A former Portfolio Manager at mega-player Wellington Management, Mark leads the first public/private active funds at Kimmeridge, one of the top activist managers in the oil space. Megan Hays has joined Kimmeridge after 15 years of IR experience including Concho and Cimarex, and even allowing for that length of experience, still recently rated as one of Hart Energy’s “40 under 40.” Please click this […]

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9:00 AM
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