Posted by: zmanbackup | May 20, 2019

Monday Morning



Market Sentiment Watch: Broad markets still focused on China (trade talks are reportedly entirely halted at the moment). Energy markets focused on OPEC (Saudi vs Iran) and the directionality of 2H19 OPEC+ output.  In today’s post please find The Week That Was, our week ahead, and some other odds and ends.

Ecodata Watch:

  • We get the Chicago Fed at 8:30 am EST (no forecast, last read was -0.15).

The Week Ahead: 

  • Tuesday – Existing home sales,
  • Wednesday – FOMC minutes,
  • Thursday – Jobless claims, new home sales,
  • Friday – Durable goods, core capital goods.

In Today’s Post:

  1. Holdings Watch
  2. Commodity Watch
  3. The Week That Was
  4. Stuff We Care About Today –  Our week ahead
  5. Odds & Ends

Click the link directly below this to …

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Holdings Watch:

ZLT (Zman Long Term portfolio)

  • Last Week’s Trades: None
  • ​The Blotter is updated.

Commodity Watch:

Crude oil rose 2% to close at $62.76 last week on a positive side of neutral weekly report from EIA and benign monthly reports out of OPEC (they actually moved the call on OPEC volumes up) and IEA. The strip and Brent were up 2% as well with the spread to WTI ending the week over $9. Crack spreads remains very strong (generic 3-2-1 crack at $23.90) and we expect further sawing higher action in U.S. refiner throughput near term.  This morning crude is trading up slightly.

  • OPEC Watch: The Sunday meeting of the JMMC yielded a statement pointing to a continued focus on achieving a balanced oil market.  Saudi indicated there is consensus to continue bringing inventories down while reassuring customers that all demand will be met.  UAE indicated now is not the right time to increase output.
  • Saudi Watch:  Reports of additional Houthi attacks in Saudi were reported overnight.
  • Russia Watch:  Russia said it is open to increased output but said it will comply with whatever OPEC+ decides at the June meeting.
  • Iran Watch:  Trump told Iran to never threaten the U.S. or face the end of Iran.  This comes after parts of his administration looked to de-escalate tensions late last week.

Natural gas closed up a penny last week at $2.63 with the strip up a percent at $2.77 as EIA reported another large but in line with expectations injection. We expect a modestly smaller injection this week on higher exports and stronger demand.  Prompt and strip gas continue to make slow headway off the April lows as injection run high in the shoulder but perhaps less high than some fear. This morning gas is trading up 5 cents.

Weather Watch:

Last week:  

  • Gas Weighted Heating Degree Days (HDDs) came in at 47 vs 41 normal and 48 in the prior week. .
  • Cooling Degree Days (CDDs) came in at 20 vs 20 normal and 18 in the prior week.

This week’s forecast:  Warming up

  • This week, CPC predicts HDDs will drop to 23 vs 32 normal.
  • This week, CPC predicts CDDs will double to 42 vs 27 normal.

The Week That Was

Stuff We Care About Today


Other Stuff

  • Look for additional cheat sheet updates this week,
  • Look for updated comments on VNOM (unowned),
  • Look for the return of the Permian Players Short Form Update and Orange Charts,
  • Look for the Gassy Players update this week.

Odds & Ends

Analyst Watch:

  • TBA in comments


  1. Apologies, unexpected Server issue to start the week off. Scott will be on the case soon.

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