Energy Sector

[Blake Hampton]

4 minutes ago, Dalal.Holdings said:

So will oil bulls sell out on the run up and lock in profits? From what I've seen, every time there is a geopolitical event that spikes energy prices, oil bulls say "ha ha" and sit on their investments (maybe even buy more) only to later see oil fall further...

 

In fact, I bet a lot of oil bulls are underwater and even with the spike tomorrow will remain underwater on their cost basis (e.g. those who followed Warren into OXY in the $60s)

 

I will almost certainly not be buying more if prices move up a lot, and I won't be selling anything unless it gets real stupid.

Oil is a long-term hold for me.

[Blake Hampton]

Just now, Dalal.Holdings said:

So you won't be locking in profits. Got it. 

 

So much for the "Those price spikes are the opportunity."

 

I think prices can spike more than you think.

[Dalal.Holdings]

2 minutes ago, Blake Hampton said:

 

I will almost certainly not be buying more if prices move up a lot, and I won't be selling anything unless it gets real stupid.

Oil is a long-term hold for me.

 

So you won't be locking in profits. Just like most oil bulls I've observed in the past.

 

So much for the "Those price spikes are the opportunity."

[Dalal.Holdings]

Just now, Blake Hampton said:

 

I think prices can spike more than you think.

 

Pictured below: every oil bull geopolitical doomer

 

[Blake Hampton]

But they can also probably sink more than I think.

I'd say price crashes are the opportunity more than anything.

[Blake Hampton]

There were both oil and farmland bubbles in the late 70s / early 80s, back when everyone feared runaway inflation. The guy in my PFP made a lot of those people go broke.

Just something to think about.

 

Edited June 15, 2025 by Blake Hampton

[Gregmal]

Recall prior to Ukraine we had a $90 barrel and post it went to $125-130 and folks proclaimed that this entrenched inflation was going to persist for as long as the war continued. And well, today it’s still ongoing, we had another one in Gaza, now what we d probably consider a third, and…oil can barely hold $70. The macro guys really don’t know shit

[Libs]

1 minute ago, Gregmal said:

The macro guys really don’t know shit

 

They are trying to play an impossible game, that's the problem......and predicting oil prices is the biggest fool's game of them all.

 

 

[Pelagic]

1 hour ago, Dalal.Holdings said:

 

Pictured below: every oil bull geopolitical doomer

 

 

It seems more and more likely that regime change in Iran is a real possibility, it would be particularly ironic for the doomer types if it does occur and a western friendly regime takes over. We'd see a ton of FDI into Iran's energy sector with Iran exporting more oil in coming years. 

[Dalal.Holdings]

1 hour ago, Blake Hampton said:

There were both oil and farmland bubbles in the late 70s / early 80s, back when everyone feared runaway inflation. The guy in my PFP made a lot of those people go broke.

Just something to think about.

 

 

There was something else that happened in the 70s that caused oil prices to spike. I’ll let you try to figure it out.

 

The ‘80s and ‘90s were a bloodbath for oil though…

[Blake Hampton]

15 minutes ago, Gregmal said:

The macro guys really don’t know shit.

 

You're not talking about me, are you @Gregmal?

[Blake Hampton]

14 minutes ago, Dalal.Holdings said:

There was something else that happened in the 70s that caused oil prices to spike. I’ll let you try to figure it out.

 

The ‘80s and ‘90s were a bloodbath for oil though…

 

Yeah, one of the two was an Iranian Revolution. That could happen again don't you think? Unrest there is already pretty extreme.

 

I don't think many of you understand just how scared people were of inflation back in the 1970s; People literally thought they were witnessing the death of the U.S. dollar. "Cash is trash" they said. Of course, Volcker's actions ultimately saved us from that, but I don't know if we'll be so lucky in the future.

I'm starting to agree with Buffett. I think long-term that the dollar could be "going to hell" (his words).

 

Edited June 16, 2025 by Blake Hampton

[Gregmal]

16 minutes ago, Blake Hampton said:

 

You're not talking about me, are you @Gregmal?

Nah we all are mostly small potato’s here. Lot of talking heads had these wild forecast around oil pre Ukraine and definitely post Ukraine. Honestly it seems the only people whom make money on oil are the ones who sell it, or the ones who sell stories about it. 

[Blake Hampton]

Quote

On Saturday, Esmail Kowsari, a senior commander in the Islamic Revolutionary Guard Corps, warned that Iran is considering closing the Strait of Hormuz through which a third of the world’s oil flows.

“Our hands are wide open when it comes to punishing the enemy, and the military response was only part of our overall response,” said Kowsari, who is a member of parliament in addition to his military position.

 

WSJ: Israel’s Fight With Iran Spreads to the Energy Sector

 

I know Iran likes to bark a lot, but if they really wanted to, they can absolutely cause chaos in energy markets:

• Hit Saudi production

• Hit Iraqi production

• Close the Strait

I’m not saying it’s certain, but if Israel backs them into a corner, they might just go crazy. And you also have to consider their own production. Israel's really putting the heat on their ass; blowing up gas facilities and water plants. Seems like a great recipe for an upset populace.

 

Edited June 16, 2025 by Blake Hampton

[Blake Hampton]

And oil prices are down lol. Who gives a shit.

 

These market prices mean less than zero as any sort of indicator for anything.

[73 Reds]

1 minute ago, Blake Hampton said:

And oil prices are down lol. Who gives a shit.

 

These market prices mean less than zero as any sort of indicator for anything.

Huh?  The markets are probably some of the best predictors of large-scale events and outcomes.  The outcome of this conflict has never been in doubt.  Not one shred of doubt.  Israel will prevail.  The only questions are when and the number of casualties.  

[Blake Hampton]

4 minutes ago, 73 Reds said:

Huh?  The markets are probably some of the best predictors of large-scale events and outcomes.

 

Markets are dumb. They can move quickly, in either direction, simply off a whim.

Oil was $60 a month ago. What changed? Instability in the Middle East? What a shocker.

 

Edited June 16, 2025 by Blake Hampton

[Dalal.Holdings]

There goes that spike...

 

I hope you guys sold or you'd better hope for another spike...

[Dalal.Holdings]

11 minutes ago, Blake Hampton said:

And oil prices are down lol. Who gives a shit.

 

These market prices mean less than zero as any sort of indicator for anything.

 

They're only useful as an indicator when oil prices are going up, amirite ? 

[Blake Hampton]

Today's market prices for anything mean absolutely jack about their fundamentals.

 

Stocks, bonds, commodities, real estate, anything.

 

Some idiot buys a stock for 1000x earnings? That's the new market price.

 

This same concept applies to any risk asset.

[Blake Hampton]

You think oil being $70 today is any sort of indicator about its average price over the next 5, 10, 20 years? What if it gets to $80 tomorrow? Or $60 tomorrow? $120 or $50 next week?

What if the S&P 500 gets cut in half? What if it doubles? Does that change its earning power? Does it change the amount of invested equity capital?

 

It just doesn't mean a thing.

 

Edited June 16, 2025 by Blake Hampton

[73 Reds]

7 minutes ago, Blake Hampton said:

You think oil being $70 today is any sort of indicator about its average price over the next 5, 10, 20 years? What if it gets to $80 tomorrow? Or $60 tomorrow? $120 or $50 next week?

What if the S&P 500 gets cut in half? What if it doubles? Does that change its earning power? Does it change the amount of invested equity capital?

 

It just doesn't mean a thing.

 

Blake, you've got so much to learn about making money.  A friendly suggestion:  If you've never heard of John Hussman, look him up and study his history.  The poster boy for missing the forest through the trees.

[Blake Hampton]

1 minute ago, 73 Reds said:

Blake, you've got so much to learn about making money.  A friendly suggestion:  If you've never heard of John Hussman, look him up and study his history.  The poster boy for missing the forest through the trees.

[Blake Hampton]

So, while Trump was pushing the "51st state" rhetoric, there’s also a sizable number of people in Alberta who want to secede.

 

Alberta accounts for around 80% of Canada’s oil production.

 

Hmm...

[73 Reds]

1 minute ago, Blake Hampton said:

So, while Trump was pushing the "51st state" rhetoric, there’s also a sizable number of people in Alberta who want to secede.

 

Alberta accounts for around 80% of Canada’s oil production.

 

Hmm...

About 12% of the entire population of Canada?  Hmm..