By Paul Sankey
Published on February 29, 2024 at 9:03 AM
Market backdrop: our argument that low US refining utilisation this month (Feb 2024) would tend to pressure crude prices, tighten product inventories, and raise product prices, is not working at all, leading us to demand concerns. Refiners have been weak accordingly, even if background GDP data and better than expected China numbers suggest a good year for refiners. It’s not all bad news: crude oil prices are acting well. Generally with seasonality, tough January weather …
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By Paul Sankey
Published on February 25, 2024 at 7:29 PM
Greetings, There is an embarrassing feeling about current equity markets, for us writing this note, a bit like hosting family lunch on the patio at the country club, while trying to ignore the spectacular naked celebrity gloriously sunbathing by the pool. To be less… conceptual: we got our answer to the question we posed last Sunday on NVDA earnings. ~ It’s hard to avoid staring but we pretend to focus on the slightly dry turkey …
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By Paul Sankey
Published on February 21, 2024 at 9:15 AM
Good news: Chesapeake is cutting activity in US natgas. In the “long cuts/short active” gas drillers pairs, we like propane-rich Antero long vs Short EQT who continue to keep activity high. EQT is supported by its hedging, which makes no sense to us: these financial instruments can be used to maintain cashflow, with no need to maintain activity. Generally, we do not like dry gas plays in 2024, but would favour Chesapeake with capex discipline, …
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