1 month Exxon, Suncor, Devon today. Reddit      

I make posts here about oil relatively frequently at this point. Todays price action on crude is something I expected after the fed meeting. A stronger US dollar does not help oil, but I think for the long run, the oil thesis is still very much in tact and today may be a good opportunity to average up, or buy calls for good companies.

All 3 of my oil holdings are taking big losses today, as well as my options. I took the opportunity to buy more shares of Exxon. I have not bought more suncor or Devon because I believe that I may be able to get them cheaper at some point, and I’m also happy with my overall positions and cb so far. I did also buy farther dated calls for Exxon, and I did them at a higher strike($70 1/22.) I still hold $60-65 7/16 strike calls.

I think this is oversold and I believe this is worth holding. Most people have been in oil for a while, and I have gotten in relatively late (Feb) I still think this is going to play out well for people long oil. WTI is creeping up mid day. We also had a fantastic day for oil on Tuesday, with prices gapping up significantly. I think this is normal commodity volatility and is NOT worth panicking about.

These companies are not at precovid highs despite the financial situation they are in. I would suggest waiting for earnings to reassure that the higher oil prices are going to mean fantastic cash flows for Exxon (and others.) The price of crude, even if it stays at current levels, will make the company be able to comfortably afford a dividend hike, which will make the shares more valuable.

I brought up the stronger dollar, and that is what I feel is really hitting the energy sector today. Commodities all around are taking a hit, this is not just oil getting hit. Inflation is very real still as well, and inflation is great for oil. I think the shakeup today is probably people taking profits (understandably so,) and repositioning.

Commodity volatility should be expected. I have not seen it this squirrelly in a while though, but I expect that even though the graphs may look a bit fishy, this will continue playing out the way oil longs think. Best of luck to you all, stay safe out there, the market is definitely a bit strange these days.

submitted by /u/third_legatron
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