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VBIN's oil stock thread.
#31
(11-11-2020, 09:09 AM)EricL Wrote:
(11-11-2020, 02:51 AM)vbin Wrote:
(11-10-2020, 10:11 AM)EricL Wrote: Here's a new oil market analysis from one of the research firms I follow:



Well worth a read for those considering energy.

Eric, Thank you so much for sharing. Very interesting read. What oil stocks or ETFs are you looking at? How are you planning to invest in oil? I checked out your website but did not see anything specific to current events with oil.

I'm pretty boring with my investments, as I hold CVX, EOG, KMI, and XOM in my DGI account. Also own ENB and OKE in another account, and EGY for a speculative position. For my DGI account, energy is currently a 5.6% weighting, you can see how much of each position I hold about 3/4 of the way down this page.

I don't follow ETF's much, but just looking at the top holdings of XLE, I think that would be a reasonable approach, as CVX/XOM/KMI/EOG represent about 50% of the assets.
I'm not a huge ETF fan, but this one of those times I could get onboard with XLE for a couple reasons.  The strongest players dominate it and the sector is down pretty hard.  Not saying any of those top holding are cutting their Div, but the sky is still a little black and and if they cut those individual stocks would get whacked hard.  VBIN already owns a fair amount of XOM and some diversification within the sector makes a lot of sense to me.  If all is well soon, the ETF will do well enough vs the majors.
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#32
Oil will fall right back where it was last week. Don't get too excited lol
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#33
(11-11-2020, 10:48 AM)divmenow Wrote: Oil will fall right back where it was last week. Don't get too excited lol

Your probably right. But it still represents great value at these levels if these companies can maintain their dividends. The vaccine news wont even be available until next May. So people will still be staying in doors and do less driving.  And even then people will still travel less. But I'm betting on a descent 2022  Tongue

I actually just bought XOM and VLO

I cant wait 3-5 years to make 25%  Big Grin
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#34
(11-11-2020, 07:57 AM)fenders53 Wrote: Do either of you know what % of oil is used by aviation and how much of that is passenger?  It would seem that ground transportation dwarfs it but maybe not?

This article is a few years old, but I doubt the percentages have changed much. 

Here's the relevant image from it:
[Image: ODS6.png]

As of 2015, vehicle transportation represented about 20% of liquids demand, trucking ~20%, and ship/trains/planes ~10%.
My website: DGI For The DIY
Also on: Facebook - Twitter - Seeking Alpha
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#35
(11-11-2020, 10:56 AM)kblake Wrote:
(11-11-2020, 10:48 AM)divmenow Wrote: Oil will fall right back where it was last week. Don't get too excited lol

Your probably right. But it still represents great value at these levels if these companies can maintain their dividends. The vaccine news wont even be available until next May. So people will still be staying in doors and do less driving.  And even then people will still travel less. But I'm betting on a descent 2022  Tongue

I actually just bought XOM and VLO

I cant wait 3-5 years to make 25%  Big Grin
You're gonna be rich Kblake!!!  Actually I am getting near a re-entry point for a trade.  I was waiting for something that looked like a bottom.  That down everyday thing is hard on your morale. If I can hold for 6 months for a pop and grab a div along the way I'll call it a win.  Oil will pull back a bit as the pandemic gets nasty for a few months.  OPEC just adjusted demand projections down again.  That's a good thing IMO as they have to keep a leash on suppliers through the winter.  I may be full of it but you gotta have a narrative right?  Smile
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#36
(11-11-2020, 11:05 AM)EricL Wrote:
(11-11-2020, 07:57 AM)fenders53 Wrote: Do either of you know what % of oil is used by aviation and how much of that is passenger?  It would seem that ground transportation dwarfs it but maybe not?

This article is a few years old, but I doubt the percentages have changed much. 

Here's the relevant image from it:
[Image: ODS6.png]

As of 2015, vehicle transportation represented about 20% of liquids demand, trucking ~20%, and ship/trains/planes ~10%.
Thanks Eric.  I think we can add our little tweaks to the curves knowing what we know today about growth rates (or lack thereof) for our UTEs production, general direction of renewables, pandemic etc.  I asked the question because I have read comments that seemed to over-react to the passenger air travel peaks and valleys.  Doesn't seem to me it makes or breaks oil demand in the big picture.
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#37
Saw an article on CNBC. Assuming no new incentives from GOV. 3-4% renewables growth projections for 2021 and a little less in 2022. This is for power generation only. Should finally surpass coal. Seem like rational numbers to me.
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#38
Floating storage levels back down to within normal range.

[Image: Em9HxcWXUAI7Cw9?format=jpg&name=medium]
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Also on: Facebook - Twitter - Seeking Alpha
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#39
Sounds like we are going to open up contracts to drill the Arctic reserve wildlife refuge. As a fly fisherman who has enjoyed Alaska three times the past few years, can anyone explain why that is necessary or even financially prudent in this supply environment? You are probably all aware every AK citizen get an annual subsidy/royalty check from oil sales. During booms it's pretty good money but not much the past few 4+ years of course. This is my nature boy side talking. They can probably drill it without wrecking the region. It just needs to come with regulations which is a dirty word in the current administration. I have no idea how much doing it responsibly affects production costs. My truthful first response is why in the hell do we need more supply anytime soon?
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#40
India announces to double oil refining capacity in next 5 years which is a much more aggressive than previous plan. Chinese set to eclipse america and become #1 oil refiner in world.

2 largest pop nations still investing in oil capacity. Oil is here to stay. Only question still remain if post-covid companies can ramp up production with increased demand and again start pushing oil prices down sooner than expected.
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