| | | Good Morning Sun,
Upon graduating from college, I traded some futures. Won on 3 and lost on Sugar. Netted me a slight loser.
Back then the only quotes I could get required calling a floor trader and I burned him out with my frequent quote calls.
I realized it was a game I wasn't set up to do properly - even though I lived in Chicago and the Mercantile Exchange was just downtown.
My only exposure to the commodity is through large positions in KMI, CVX, and XOM.
As long as oil trades above 75.00 on an annual average, they all will have huge cash flows and a growing balance sheet and dividend.
I do think that PEC + is tapped out on being able to produce more oil. The US will add some capacity, but the price collapse that the pandemic created forced a lot of the tier one wells to be overly drilled. The next million barrel increase will be harder and more expensive to do. The US has shale and the Gulf of Mexico, both of which can slowly add to our production. Suriname, Guyana , and Brazil offer long term production but longer term events.
If Russia loses half of their production due to bottlenecks and China comes back to moderate growth, driving season picks up, and the world travel reverts to pre-pandemic levels, it is possible that demand exceeds all producers capabilities to pump.
I view that as a very possible event. It will boost prices, which will fund the needed big plans to boost production over a very long term time horizon.
I do NOT need to see that happen, but if it does, it will be a great time to sell off some shares and leave the markets money working for me as I pull out my seed money.
There will be a rotation of another sector that gets very unfavorable views by investors.
Hopefully it will provide some additional diversification in my portfolio.
Who knows maybe I'll pick up some EV's that o broke or consolidate.
My running buddy bought a new Tesla and I got to ride in it last night. Great navigation presentation. It is the same thing my GM Denali has bit presented in such a more detailed picturesque way on the in car monitor.
It is the ADAS system presented in a much fancier way.
The time for charging is what kills the car with me. I make a lot of cross country trips in the US. When going back and forth from Wisconsin to Texas, I time my gas stops with the discipline of keeping the wheels rolling. We buy provisions such that we eat on the road and stops are for a restroom break and a fuel fill up. It would drive me nuts to sit and charge up the battery and watch a You Tube while charging up.
For just bumping around The Woodlands, or Howards Grove a home charging station would do nicely.
These next 2 to 3 years will bring on a LOT of competing entries. I suspect competition is going to be brutal. Some will not make the cut.
Fossil fuels will be with us longer than I will be I think.
They will be great long term dividend payers I think and hope.
Bob |
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