Sweet 16 Update - June 22

[dan_s]

The updated Sweet 16 main spreadsheet has been posted to the EPG website.

On June 21st WTI closed at $57.47/bbl which is $12.21/bbl higher than where it closed on January 2nd.

The Sweet 16 gained 6.24% during the week ending June 21st, but the portfolio is still down 2.68% YTD. If I remove the four gassers (AR, GPOR, RRC and SWN) the Sweet 12 is up 3.66% YTD, which is still ridiculous considering the big increase in oil prices. Raymond James still sticking with their forecast that WTI will average $75/bbl in Q4 2019 and $90/bbl in 2020. I'm not that bullish, but $65 in Q3 is now definitely in range.

CLR and EOG are good bets if you believe oil prices are heading higher since none of their oil is hedged.

EnCana's Q2 results, the first full quarter since the merger with NFX, should be very impressive.

The Sweet 16 is trading at a 70% discount to First Call's price targets. I can't remember EVER seeing it at such a discount to FC valuation.

2nd quarter Adjusted Net Income s/b solid for all 16 companies.

There is lots of "noise" out there which is keeping investors on the sidelines.
> Iran
> U.S. vs China trade war
> OPEC+ meetings on July 1 & 2
> Russia to meet with OPEC+ on July 3
> Venezuela in total free fall
> Fed interest rate cuts
> U.S. dollar index on decline supports higher commodity prices

My guess is that Iran's leaders will do something very stupid. Just saying they will not negotiate with Trump is insane since the U.S. holds the upper hand. If the U.S. does execute air strikes against Iran the price of oil will spike, probably by 10%. Plus, we are now in the annual summer spike in demand for transportation fuels. Declining OECD oil inventories should support higher oil prices.