Petroleum: Being Up In A Down Market

So, the petroleum industry.

Lots of you have asked me to explain what the current state of things are and where things are headed. So, since it is spring and time for all things new, here we go.

Soooooo As many of you know, Opec is made up of several nations. Iran, Saudi Arabia etc. We within “The Bigs” have been VERY successful in our endeavors of getting product OUT of the ground and refining it in a better, more cost effective manner that is great news for the American economy that sees LESS dependency on foreign oil and more job-producing expansion here at home.

It’s simple really…. And it doesn’t take a PhD in Business to figure it out.

Supply and demand is what it boils down to.

The Saudis….not Iran…. Not some rogue anti-American entity out there hell bent on undermining American lives… The Saudis know that we are experiencing this boon and are doing what they can to see us struggle. The Saudis are in command of one of the largest supplies and stockpiles of petroleum on the planet.  ….and so it follows that in order for them to stay “King” (not so ironic pun) of it all…they flood (also a great pun) the market with product, causing demand to go down and us all to pay less for production here at home as we can get product “on the cheap” enjoying all the Saudi product.

They do this because they want to flatline our drills and wells…. They want to drive them so far into mothballing that they “Never” come back. It is WELL known that this was their goal from the start….flood the market with product until the Biggs are COMPELLED/FORCED to ease operations and relinquish their fast-growing “control” to who has always had it…”The Kings/Saudis”…

As we speak we are in the middle of this. When the market closed yesterday, we closed at $59.17 and this is a modest improvement after where things were (in the upper $30’s) around the holidays.

Oil has its ups and downs…. It just does. Most of us know this and as consumers we can all most likely remember times in our lives when our price at the pump has been a happy or sad experience!

Here’s the kicker though…..    ….. as far down as we have gone…. Smart investors know that the Saudis supply is FINITE….   …..meaning there is an END to the flood they are pounding out into the market right now. Investment in petroleum stocks is where the smart money is right now. You have to be a complete fool with your money not to at least be buying in at some levels right now.

I think that my Roth is a pretty decent spread of many things…but I have to admit I HAVE taken control on some levels and covered the bigs as we get set for this remarkable rebound.

The Saudis know they cannot keep this up forever. They know we can call back all of our laid-off field workers in a quick minute and start collection/production right back up again. …they gotta be scared…because at THIS point… we (The United States) are set to essentially render OPEC useless. Without the stockpile they have run through…they no-longer have domain over world oil prices and they are set to be controlled by those nations who are self sufficient.

Now, I am CERTAINLY NOT trying to offer yall advice on the stock market OR on what or where we will move with PSX in the near future…. BUT… what I CAN say is that we will most likely rebound considerably into a more realistic $70-$80 range before it’s all over. That is a modest but worthwhile improvement to all of us stockholders and it is a true statement to OPEC that we are “over it” when it comes to their shenanigans.

….there I said it.
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On to the Fam

Soooo, Hayley has tried out for and made the Varsity Dance Line. She has been working in her ballet classes all year and she is really excited to start and get involved over the summer and fall.

She has finally started with the whole boyfriend thing much to my dismay. She has already been through a nice young lad named “Dyllan” and is now seeing a junior …don’t know what his name is…lol like it matters… 

That being said, we have seen a miraculous turn-around in her behavior and she is a completely different person when it comes to her contributing to the family and interacting with Angela, Hayden & I.  It’s just so amazing to be here and in the moment as we shape and mold this young lady and get her ready for college. Wonderful.

As far as Hayden goes…. Hayden is capping his first year in the Minors playing second base and pitching. We have worked diligently to get him enmeshed within player-pitch normalcy of the Minors and he came through his first moments of being struck by baseballs like a champ.

In fact, during one of his first games, he got hit in the face and suffered …..) some say “Was awarded” the way ye strutted around with it) a black eye for his efforts as well as the game ball as he refused to stop playing during the game after suffering the injury. 

Angela & I have also seen a shift in our property acquisitions. We sold our initial development when two lots along the bay came open up here off of the 2354. We REALLY want a bayside property to develop instead of developing on land and then purchasing a beach house in Galveston.

Once negotiations are complete with the county and we close on the Victoria property, we will begin constructing either at the bayside location or the Sellers Station location as K Hovinian offers the Mandalay floor-plan we are both happy with.

It will mean that we press ahead with the Galveston acquisition but the bonus here (and really the governing element) is that the kids stay in the Barber's Hill School District of Mont Belvieu. A top-notch Texas district, the kids enjoy stability as well as a well rounded life outside of the classroom in extra curricular activities. And stability is the name of the game here. It's why they are straight A students and what we sacrifice for. 4,000 square feet on an acre and a half will be just the kind of sacrifice they need to ensure they thrive.

We shall see…. All good things in time. Angela has 17 more days before we retire her from teaching. I can’t wait. Sheldon has really beat her down as contractual issues have caused them to move her out of her comfort zone and into teaching some real shitheads. I know that’s a tough sell to a third grader but….when you are in THAT part of Houston…it’s like being from Duluth….unless there’s a miracle…you can count on having a shiitty quality of life, never making it out of the city and a life filled with new and exciting ways you tell the world how “Great it is there”.   …that’s not mean, it’s just reality….when you live in an “opportunity litter box”, what difference does it make if you stick it in the freezer 9 months out of the year?  “Oh my god! There’s snow!” lol…. when it thaws out it’s still shit/gross.

Sheldon, will go on….but in my opinion the majority of teachers in this country would be wise to bail now on this bastardized form of primary and secondary American instruction; home grown by the Obama Administration. It’s gross, it BEYOND micromanaged and it’s just time for the good people to get out. We are pulling Angela so that she can focus on being a mom, do Consulting work and basically live the stress-free life she deserves as my wife.

I think that’s about it for the spring update. Will be back around the fall for more.

Take care and be good ya’ll!

Our Best,

Texas’ A&M