To The Moon

This is still a work-in-progress post even as I share it here. On Mon, 04 Aug 2025 (Asia time), oil prices edged higher paring earlier losses. This as traders expect the market to absorb another large output hike by OPEC+ in September 2025, while concerns about disruptions to Russian oil shipments to major importer India provided support. So far, As of 14 Aug 2025 (Asia time) Brent crude futures has been falling since Mon, 11 Aug 2025 to $65.10 a barrel. (see above) As of 14 Aug 2025 (Asia time) It is the same story over at US West Texas Intermediate crude. Its down to $63.00 a barrel, as of Thursday morning asia time, up marginally by +0.56% (see above) 03 Aug 2025 (Sun). On Sunday, the Organization of the Petroleum Exporting Countries and allies, a.k.a OPEC+, agreed to raise oil production by +547,000 barrels per day (bpd) from September 2025 onwards. This will be the latest in a series of accelerated output hikes to regain market share, citing (a) a healthy economy and (b) low stockpiles as reasons behind its decision. The move is in lined with market expectations. It will also mark a full and early reversal of OPEC+'s largest tranche of output cuts, plus a separate increase in output for the United Arab Emirates (UAE), amounting to about 2.5 million bpd, or about 2.4% of world demand. Sidetrack - OPEC+ started cutting oil production in April 2023. The cuts were first supposed to end in December 2023, but were extended to December 2024, and finally March 2025. According to Momo Australia (online trading platform), Chief executive, Michael McCarthy: OPEC+ additional production appears to have little impact because it was so well flagged ahead of time. It also appeared that traders focused on comments from state OPEC producers that, previous additions have been easily absorbed, particularly across Asia. At the same time, Goldman Sachs think that the 8 OPEC+ countries that have raised oil production since March 2025, will actually add 1.7 million bpd. This is because other group members have reduced their output after overproducing previously. Sanctions. Still, investors remain wary of further US sanctions on Iran and Russia that could disrupt supplies. On a few occasions, Trump has threatened to impose 100% secondary tariffs on Russian crude buyers as he wants to pressure Moscow into halting its war in Ukraine, by 08 Aug 2025. On the one hand, the threat seemed to work as: At least 2 vessels loaded with Russian oil bound for refiners in India have been diverted to other destinations following new US sanctions. This was confirmed by trade sources on Friday, with LSEG trade flows supporting it. It puts about 1.7 million bpd of crude supply at risk if Indian refiners stop buying Russian oil, said ING analysts led by Warren Patterson. This could potentially: Erase the expected OPEC+ surplus through Q4 2025 and into 2026. Provide OPEC+ the opportunity to start unwinding the next tranche of supply cuts totaling 1.66 million bpd, even earlier. On the other hand, 2 Indian government sources told Reuters on Saturday, India will continue to purchase oil from Russia despite Trump's threats and much to his irks. (see above) US Tariffs Implications & Impact. US Trade Representative Jamieson Greer confirmed on Sunday that the tariffs imposed last week on scores of countries are likely to stay in place rather than be cut as part of continuing negotiations. Concerns about US tariffs impacting (1) global economic growth and (2) fuel consumption are also hanging over the market, especially after weak US economic data on payroll jobs growth that was way below expectations. My viewpoints: (mine only) To be able to arrive at a plausible conclusion, will need to cut out the noises. This includes: Trump’s additional 100% tariffs on countries purchasing Russian or Iranian oil. India continuance or ending of Russian oil purchase. What is at stake ? With anticipated supply hike in September 2025, the coming months will put OPEC+ cohesion to the test. The challenge is unwinding the remaining 1.66 million bpd in cuts without fracturing the alliance. The stakes are high for oil stocks investors. Energy Stocks - Still a Buy? OPEC+ production hike has created divergent fortunes for energy firms. (1) Defensive OPEC+ Equities., Non-US stocks - Saudi Aramco and ADNOC (Wining). Remain attractive due to their robust balance sheets and long-term fiscal support. These companies are also pivoting to low-carbon technologies, including carbon capture and hydrogen production, to hedge against the energy transition. (2) US Shale Producers. US stocks - Devon Energy (DVN) & $Occidental(OXY)$. (losing) Likely to face dual challenges of (1) lower prices and (2) geopolitical volatility and will be exposed to (3) price compression and (4) trade instability. As of 13 Aug 2025 closing Below is OXY’s performance over a period of time: On Wed, 13 Aug 2025, OXY closed higher by +1.36% at $44.75 per share. Over past 5 days, it closed higher at +1.94%. Over past 1 month, it closed lower at -0.71%. OXY performance mirrored what analysts have predicted. (3) Integrated Giants. US stocks - $Exxon Mobil(XOM)$ & $Chevron(CVX)$. (Wining). With (a) diversified portfolios and (b) strong cash reserves, they are better positioned to weather the storm. As of 13 Aug 2025 closing Below is CVX’s performance over a period of time: On Wed, 13 Aug 2025, CVX closed higher by +0.93% at $155.87per share. Over past 5 days, it marginally higher at +1.56%. Over past 1 month, it experienced a higher rise at +2.76%. So far, it’s performance is also closed to analysts’ predictions. (4) Midstream infrastructure operators. US stocks - $Kinder Morgan(KMI)$ & $Enterprise Products Partners LP(EPD)$. (Wining) They are seeing increased demand as OPEC+ ramps up production. These firms, less sensitive to commodity price swings, offer a more stable investment proposition in a volatile market. Trade As A Weapon. Trump has weaponized trade via sweeping tariffs and trade barriers on its global partners. Even key partners like China, Canada, and Mexico, are not spared. A single man’s wild antics that have sparked trade wars, unsettled global markets and disrupted supply chains. These aggressive measures aimed to leverage economic pressure for political gains but generated widespread uncertainty and retaliation worldwide. Coming back to the noises, excluded earlier (see above). Do you agree that if they are enforced by Trump, it will curtailed purchase of Russian oil and ensures the additional pump by OPEC+ will not result in a supply glut, depressing oil prices. And just like that, energy stocks (suddenly), now worth considering again, agree? Remember to check out my other posts. (See below). Help to Repost ok, Thanks. Must Read: Click on below titles to access. Repost to share, Like as encouragement ok. Thanks. RGTI, the nvidia of Quantum Computing ? Wed, 13 August. Pick post. C3.AI - Finally a "Buy" opportunity ? Wed, 13 August. Idea post. Will LCID Escape Its Penny Stock Status ? Tue, 12 August. Pick post. Do you think oil stocks’ prices will fall with OPEC+ gradually restoring their production pump ? Do you think countries feel aggrieved with Trump’s tariffs policies ? If you find this post interesting, give it wings! ️ Repost and share the insights ? Do consider “Follow me” and get firsthand read of my daily new post. Thank you. @Daily_Discussion @TigerPM @TigerStars @Tiger_SG @TigerEvents