Jun 2, 2022Liked by Dominic Frisby

''oil could go to $300'' In which case we are heading into a very, very dark time. I doubt having a few good oil shares will be enough to cheer me up.

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Jun 2, 2022Liked by Dominic Frisby

Amazing. I did two days work on all the energy ETFs available in the UK only a couple of weeks ago, and settled on exactly the same two. I wish you'd published this first :)

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Not sure about $300 oil or the price required to create demand destruction, but $180 has been bandied about.

If only oil could trade between $90-$110 forever....., economies would continue to function, everyone (well almost) would make good money, everyone would carry on as normal - life would be great....you get the idea - sadly not going to happen.

The current bull market is North America - even more specifically Canada trades at further discounts.

If you look at the charts for all the upstream cos, they look like they are at the peak of the cycle (perhaps they are - the easy money has been made), BUT, look at their valuations compared to FCF and consider that their debt is getting wiped out & with that, the hedges are rolling off. 2021 was the year of recovery & debt repayment - 2022-23 will see shareholders rewarded (dividends), possibly at expense of future CapEx - after years of suffering, management know the market is demanding returns. (I'm not such a big fan of share repurchases though - and definitely NOT at elevated valuations).

By 2023 North American E&P is going to be largely DEBT FREE! and little to zero growth plans - that free cash will be coming back to shareholders.

How to play it??? Personally, I've gone for a basket of small equity positions + some larger ones in Suncor, Cenovus, Antero Resources + a variety of dividend paying pipelines.

The basket of smaller names I'm talking about, is relatively new .....and still in progress...

I was hoping that we might see a small pullback during this summer as inventories build, particularly in Europe - before the reality of winter 2022/23 begins to approach.....

(Note, in the US, SPR inventories are falling - fast).

What happens after the US Midterms????

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Is oil going to increase in absolute values towards $300 a barrel, or are the indices going to drop by two-thirds (S&P = 1400) with oil staying at $100 a barrel, which equates to the same?

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Jun 6, 2022·edited Jun 6, 2022

WOODSIDE: "Energy profits windfall tax is a ‘red flag’ for investors"


The industry needs to be more vocal & start pushing back, if other govts are to be discouraged.

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BHP / WOODSIDE SPIN-OFF - would it be reasonable to expect some amount of sell-off on WDS over the next few weeks (potential buying opportunity), due to ESG compliance issues with funds etc. or am I way off?

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