Any thoughts on the market reaction to oil/nat gas earnings?

[aja57]

Dan,
You have been on the money with all your projections for this quarter . Yet the market despite all the sector's profitability, shareholder returns and future guidance seems to have sold on the news. Is this just one snapshot in time? Or has political agendas tied to market algo trading (yes, BlackRock's Aladdin software controls 22 Trillion dollars in assets comparable to US GDP) utilizing climate change directives transformed what once was the adage that capital flowed to productivity?
Will manipulated AI software determine the market multiple for all your painstaking expertise? Any thoughts from the group?

[dan_s]

The "Paper Traders" are reacting to all of the "noise" and WTI has pulled back to where it was right before Russia invaded Ukraine.
> Pelosi's visit to Asia did not cause WWIII
> OPEC+ "officially" raised quotas by 100,000 bpd (just a rounding error) in the global oil market
> Libya is back online, at least for now
> EIA reports a rise in US commercial petroleum inventories, which was caused by draws from the SPR and higher imports. US oil production growth is flat and there is no way it gets back to pre-pandemic levels.
> Europe's sanctions against Russia are being laughed at by Putin, China and India, which is thanking them for cheap Russian oil
> US gasoline demand is down, like it always is after July 4th
> August is the "Dog Days of Summer"

The upstream companies are doing great, especially the gassers. I recommend adding companies from our High Yield Income Portfolio while you can lock in very high dividend yield. CTRA, DVN, FANG and VNOM all reported strong results.

When Freeport LNG comes back online, I think we might see $10 HH ngas prices.

[aja57]

I appreciate your thoughts. Thanks for calming me down. I guess the heat in AZ in August makes me think I see oil mirages as far as my eyes can see...

[dan_s]

I was interviewed on a Canadian station at 12:30. Lots of good questions.
Things to remember.
> $90 oil for awhile is OK. All of the upstream companies alive today survived the Pandemic for 18 months and they are in MUCH BETTER SHAPE TODAY.
> Ngas over $8.00 and likely going over $10.00 in Q4
> The ENERGY CRISIS in Europe is real and there is no Quick Fix.
> There is a global shortage of space heating fuels. Lots of firewood will be burned up in Germany.
> OPEC is out of spare capacity. Half of the cartel countries are on decline.
> The Green Bad Deal should be ripped up when the GOP takes over the House.

[Fraser921]

Is there a replay