22
Jan
Wrap – Week Ended 1/21/22
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After a strong start to the new year energy (old and new school) sagged sharply in the holiday shortened week, taking a cue from the ongoing weak start from the broad markets for 2022. We largely sat on hands with minor exceptions noted below.
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Free Stuff Last Week: None. We have a piece in the hopper for Seeking Alpha that likely goes to press this week on an oily name.
Holdings Watch:
- We added to one solar-segment name and one oily name.
- We sold roughly one-third of our over-weight AR position, up 77% to our average cost.
- The blotter is updated.
Numbers of Note From The Wrap Table Below:
- Note XOP underperformance despite stronger oil. Also note Service, buoyed by early commentary from NEX and then BKR (but less so by SLB on Friday even though it was quite positive), is up 15% on the year still with activity and pricing headed higher.
- Oil
- Up on prompt and '22 and '23 strips.
- Note speculators advanced further into the caution zone above 6.0x.
- The EIA weekly data was again year end skew with a large gasoline build. Look for implied demand to pick up in the next couple of weeks, blending to get sorted, and stocks to begin falling.
- Distillates remain very understored.
- Throughput appears to be starting the first maintenance turn of the year a little early and we've noted some press releases to that effect. Look for a shallow and short throughput dip followed by pandemic highs.
- Oil exports are picking up on increased demand.
- Natural gas
- Second week of lift off the 12+ lows for net speculative longs as better weather prompts more covering. Natural gas remains very net short.
- Storage was better than Street expectations. The early read for next week calls for another > 200 Bcf pull.
- Renewables - continued to fall with abandon. Wind was less down but otherwise the group continues to capitulate with solar and EV tied names on the worst end of performance.
Questions and comments under The Wrap will be addressed in the Monday post. Questions about the site can be directed to zman@zmansenergybrain.com.
Have a good weekend,
Z
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