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The Implications of Qatar Leaving OPEC

By , Global Energy Strategist, Oil & Energy Investor • @KentMoors_OEI -

On Dec. 3, a week-long rumor finally saw the light of day.

I had heard it prior to my departure for Singapore last week, and it had at the time been the substance of some talk on its potential importance – if true – during our meetings.

Well, it is no longer just a rumor.

On Monday morning, Qatari Energy Minister Saad Sherida al-Kaabi announced that the Persian Gulf state was leaving OPEC, effective Jan. 1, 2019.

Qatar is a minor oil producer, averaging some 600,000 barrels a day, putting it at the bottom of the OPEC ladder along with Ecuador.

However, it is a major natural gas producer and the world's leading exporter of liquefied natural gas (LNG).

But there is a more important reason why Qatar leaving OPEC is likely to shift the regional tensions into a higher gear.

And it's not about oil.

It's all about using natural gas as an increasing global lever...

A Rift Emerges in the Oil Industry as the Conversation Deepens in Singapore

By , Global Energy Strategist, Oil & Energy Investor • @KentMoors_OEI -

oil around the world

Here in Singapore, things influencing the oil world continue to make themselves clearer.

Recently, the oil market has been slammed with a tidal wave of volatility, and back a few weeks ago we had the largest drop in oil prices since 2015.

However, since I've been attending meetings here at OSEA 2018 in Singapore, one signal that the implosion in oil prices is nearing its end has surfaced.

In each of the last several downward cycles in the price of both daily pegged benchmarks (West Texas Intermediate in New York and Brent in London), a divergence has emerged prior to the recovery of pricking levels.

That divergence has begun over the past few trading sessions.

It amounts to a recovery in the market prices of crude oil and natural gas production companies while the underlying price of oil continues to move downward, and it has already become a topic of conversation here in Singapore.

From the floor, the issue even made its way into my plenary address before the OSEA 2018 conference.

And here's why...

How to Use Options to Play the Next Oil Wave

By , Global Energy Strategist, Oil & Energy Investor • @KentMoors_OEI -

Crude oil prices are rising again.

Much to the relief of oil investors.

The rise has been reflected both by the West Texas Intermediate, the benchmark used for futures contracts set on New York, and Brent, the equivalent set daily in London.

As of close of trade Sept. 19 – which happened at 2:30 for oil – WTI was at $71.12 a barrel, the highest since July 10. Meanwhile, Brent closed slightly higher at $79.23.

I have previously addressed the main reasons for why the price is moving up here in Oil and Energy Investor, and for some time now, the supply side of the market balance has been tightening.

Thanks to this, there is something interesting stirring in the oil sector – something that manifested in a recommendation to my Energy Inner Circle premium subscribers just a couple days ago.

I don't often do this, but this is a fast-track recommendation I'm including in Oil & Energy Investor today, because you're not going to want to miss out on this...

Here's Why Your Gas Prices Spiked This Summer

By , Global Energy Strategist, Oil & Energy Investor • @KentMoors_OEI -

The primary summer driving season is over, and Labor Day, the last vacation weekend of the season, is fast approaching.

Travelers are winding down their end-of-summer vacation plans as we head into the autumn, and traffic between cities is lightening.

Normally, this time of year produces a decline in retail gasoline prices as the driving season ends and autumn and winter hibernation begins. And refineries are already switching primary production cuts from retail gasoline to produce more low-sulfur heating oil for the upcoming colder months.

In this 2018 season, the expected adjustment downward is not kicking in as in years past.

So, why are we witnessing an unusual increase in costs at the pump?

There are two overarching reasons, each resulting from how available refinery capacity is being utilized...

American Shale Oil Is Minting a New Class of Millionaires

By , Money Morning -

We've seen the term "disruption" everywhere in the media for the past few years.

Ride-sharing company Uber disrupted the taxi industry. Amazon.com Inc. disrupted most of retail and moved into groceries and streaming services. And when you think about it, Ford Motor Co. disrupted personal transportation a century ago when it replaced the horse and buggy with motor cars.

Now, we're seeing a disruption of American shale oil. And it's creating a whole new class of millionaire investors...

"X" (Doesn't) Mark the $1.4 Trillion Spot in West Texas

By , Global Energy Strategist, Oil & Energy Investor • @KentMoors_OEI -

Sailing the oceans in search of treasure is something of a fantasy for a lot of people.

Just imagine it, the gentle rocking of the boat...

Learning the language of the sea...

Manning the big, wooden ship's wheel...

The eventual end goal: finding the buried treasure on the deserted island that you located using the ratty, ancient map with a giant black "X" marking the spot.

Usually this type of imagining involves a hook for a hand, eyepatches, peg legs, and other such pirate accessories.

But it's the buried treasure that's central to this dream.

Unfortunately, in real life, "X" marking the spot is just that... a dream.

There is, however, unmarked buried treasure.

You won't find it in the ocean though...

This New Oil Price Prediction Calls for $400 a Barrel by 2020

By , Money Morning -

West Texas Intermediate (WTI) is currently trading for $65.80 per barrel, but one analyst has made a 2020 oil price prediction of $400 per barrel, a staggering 491% climb.

And the reason for a $400 per barrel oil price might surprise you even more...

Here's what's fueling his latest oil price forecast, and how you can cash in on rising oil prices with one of the best oil stocks to buy...

The U.S. Is Quickly Becoming the Biggest Oil and LNG Exporter in the World

By , Global Energy Strategist, Oil & Energy Investor • @KentMoors_OEI -

About 13 years ago, I was at a meeting of energy experts close to Dominion Energy's liquefied natural gas (LNG) terminal in Cove Point, Md.

At the meeting, it was unanimously concluded that at least 15% of U.S. natural gas demand would be met by LNG imports within the next decade.

In those days, nearly 70% of the U.S crude demand was projected to be met by imports.

At that time, American oil production was not even 7 million barrels a day, with well over 60% of total volume coming from "stripper wells" – each providing less than 10 barrels daily, but many more barrels of water than oil.

Back then, we were aware of the potential lurking in shale, tight oil, and gas...

But nobody could have foreseen (myself included) the largesse LNG would provide.

Well, a great deal has changed since then – and this revolution currently happening in the U.S. energy market will spell massive profits for us in the coming years...

Why Oil Is Having Its Most Volatile Week of the Summer

By , Global Energy Strategist, Oil & Energy Investor • @KentMoors_OEI -

shale oil production

If there's any industry whose sentiment can go from hot to cold in just the span of a week, it's the oil industry.

That's how this past week has been, with both WTI and Brent - the U.S. and global benchmarks, respectively - down more than 7% since July 11 when prices logged their worst daily drop in over a year.

Naturally, this has analysts and talking heads across the industry in a fit of frenzy. After all, WTI had been on an unstoppable long-term rally, gaining over 23% since the start of the year.

Let them worry.

I'm not the least bit surprised about the recent pullback. With such an incredible run to three-and-a-half-year highs, prices were bound to get overheated and drop below the psychologically important $70 at some point.

Geopolitics have been so front-and-center lately that despite boosting prices to record highs earlier this month, they have now turned on us and dragged prices back lower.

Here's how this switch happened - and why I'm confident oil markets will turn back in our favor...

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