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Substantive Shifts

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Substantive Shifts

Matt Sterett
and
Pierre Follea
Apr 20, 2021
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Substantive Shifts

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“…from ESG - tweeting that it is ‘the paper straw of investing’ because it’s ‘symbolic, not substantive’ - to SPACs: ‘There’s so much dog sh*t there,’” - from Michelle Celarier’s profile (in II) of Carson Block / Muddy Waters


Editor’s Notes:

  • Last week, we were trigger-happy - the newsletter fired while in-edit…

  • Next week - ahead of earnings - we plan to profile a US E&P

  • For now, we’ll just say: we like the stock


OIL.

A number of variables in the Oil supply / demand equation are in play.

We’ll start with the good:

  • The US is recovering faster than expected

  • China is recovering faster than expected

  • *Excessive* global stimulus

The (potentially) bad:

  • An Indian virus variant is of new concern

  • Lockdowns have “resumed” in Germany / France

  • The Iran-China deal

And, the hard-to-forecast:

  • Libya’s NOC declares force majeure

  • OPEC(+): meetings re/ Iranian production (& China deal), Russia’s compliance / willingness, &

    Twitter avatar for @Amena__Bakr
    Amena Bakr @Amena__Bakr
    It still hasn’t been decided if on April 28 Opec will hold a JMMC and an opec plus meeting or just a JMMC. Given that it’s Ramadan it’s highly likely it’ll only be a JMMC #OOTT #opec
    3:11 AM ∙ Apr 20, 2021
    28Likes9Retweets

So far, these variables have netted out to - in the short-term - higher crude prices.

Our take - if the US / China recoveries surprise (further) to the upside, then expect crude prices to continue rise -


OTHER NEWS.

India is expected to follow China, building new coal plants. As pointed out by Javier Blas, China is now expected to hit a *new* peak in coal consumption this year…

  • This time last year, WTI went negative

  • A series of interviews worth watching

  • The (retired) king of gas stirs the pot

  • Gas price earnings surprises may be coming

If you have a few minutes to spare, the II profile of Carson Block is worth the read.


That’s it for this week - for anyone following the European Super League news, we’ll note that it reminds us of the origins of the EuroLeague basketball system - if you’re struggling to grok what European football (soccer) may look like going forward, then check out the EuroLeague (basketball) license format - that’s our best guess as to what may come - catch y’all next week -

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Substantive Shifts

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