VGENX - Why PXD is it's 2nd largest holding

bee

Pioneer Natural Resources (PXD) and Texas' Permian Basin is a energy game changer for the U.S.

From Article:
"People just don't seem to realise how big the Permian is. It will eventually pass the Ghawar field in Saudi Arabia, and that is the biggest in the world," said Scott Sheffield, founder of Pioneer Natural Resources and acclaimed 'King of the Permian'.

Article:

telegraph.co.uk/business/2017/03/05/permian-shale-boom-texas-devastating-opec/

bee

The double edge sword of productivity.

From Article:

"Oil prices have plunged to the lowest level this year as US shale producers boost output at an astonishing pace and crude inventories keep rising, triggering a wave of selling by hedge funds with record speculative positions.

The US surge threatens to neutralize cuts agreed by the OPEC cartel and a Russia-led group of producers last November, potentially delaying a full recovery of the market until 2018 or even later."

And,

"It had been assumed that the Saudis would do whatever it takes to push oil back up to a band of $60 to $70 in order to smooth the way for a $100bn part-privatisation of the state oil giant Aramco next year, the biggest public offering ever. This is no longer so certain."


Finally (David Fuller's from Fuller Treacy Money) comments,:

"US shale producers in the Permian Basin, which have never been part of OPEC, are in the strongest position. They can ramp up production very quickly when prices are firm, as we have seen in recent months. Even more importantly, they can reduce output very quickly, when prices are less attractive, while preparing additional wells for the next price rise.

Most oil producers were overly dependent on $100 plus prices which we may never see again. Those (oil producing nations) with large populations face a rough time, burning through reserves and facing huge declines in their standard of living."

Link:
telegraph.co.uk/business/2017/03/09/us-shale-surge-overwhelms-oil-market-opec-splits-deepen/

bee

Shorts in play with Crude oil pricing:

mcoscillator.com/learning_center/weekly_chart/huge_imbalance_in_crude_oil_positions/

Ted

@MFO Members On 3/9/09 PXD was 12.00 per share, on 3/9/17 it closed at 187, a 1451% increase.
Regards,
Ted

Mark

"Oil prices have plunged to the lowest level this year as US shale producers boost output at an astonishing pace and crude inventories keep rising, triggering a wave of selling by hedge funds with record speculative positions."

A trusted oil insider tells me that it is not unusual for oil inventories to be rising at this time of year. Refiners scale back production for maintenance as well as shutdowns related to switching lines over to production of alternate products (i.e. think gasoline vs. heating oil). Once those are completed and the lines are switched back on inventories will fall. Bottom line, no big deal.

davidrmoran

and NG too

bee

Recent Article (3/21/2017)
Big Oil muscling in on Shale:

From Article:

If the big boys are successful, they’ll scramble the U.S. energy business, boost American oil production, keep prices low, and steal influence from big producers, such as Saudi Arabia. And even with their enviable balance sheets, the majors have been as relentless in transforming shale drilling into a more economical operation as the pioneering wildcatters before them.

and,

At Bongo 76-43, Shell is drilling five wells in a single pad for the first time, each about 20 feet apart. That saves money otherwise spent moving rigs from site to site. Shell said it’s now able to drill 16 wells with a single rig every year, up from six in 2013.

With multiple wells on the same pad, a single fracking crew can work several weeks consecutively without having to travel from one pad to other. At Bongo 76-43, Shell is using three times more sand and fluids to break up the shale, a process called fracking, than it did four years ago. The company said it spends about $5.5 million per well today in the Permian, down nearly 60 percent from 2013.

Article Link:
https://bloomberg.com/news/features/2017-03-21/big-oil-s-plan-to-buy-into-the-shale-boom