so hear me out because i think monday is going to be absolutely nuts for OXY and i havent seen anyone talking about this yet
for anyone who wasnt paying attention this weekend — US and Israel hit Iran friday night. like ACTUALLY hit them. khamenei is dead. operation epic fury. b2 stealth bombers the whole thing. and heres the part that matters for us: iran closed the strait of hormuz in response
if you dont know what that means — 20% of the worlds oil moves through that strait every single day. its closed. done. ships cant get through.
right now theres 750+ ships just sitting in the persian gulf. ~450 tankers, 170ish container ships, 200 bulk carriers, even 14 LNG carriers. just floating there. hapag lloyd suspended transits. maersk suspended. CMA CGM told their ships to shelter in place. the US navy literally told commercial shipping they cannot guarantee safety anywhere in the gulf
three ships already got hit near the mouth of the strait. insurance premiums for war risk went up 50-100% overnight
so OPEC had their meeting today (sunday). everyone was watching to see if they'd flood supply to calm things down. they debated releasing anywhere from 137k to 548k barrels per day. they went with 206k. thats basically nothing. thats SA saying "yeah we hear you" without actually doing anything to move prices. oil stays high.
brent crude was trading around $80 OTC sunday. OXY closed in the mid 50s friday. do the math on what monday morning looks like.
heres why i like OXY specifically over other energy names — their permian basin breakeven is around $40/barrel. at $80 brent theyre printing pure margin. but the bigger picture is what happens AFTER the initial spike.
trump told the daily mail this is a "four week process." hes literally talking about regime change. theres already talk about reza pahlavi the exiled crown prince as the replacement. if that happens iran has 150 billion barrels of reserves that come back online and guess which countries companies get those reconstruction contracts? not china. not russia. american companies.
OXY has middle east operating history. they are literally positioned for both sides of this trade. short term = oil spike. long term = reconstruction contracts in a new iran thats friendly to US interests
oh and if you missed it — the big beautiful bill that passed last summer already killed green energy subsidies and went all in on fossil fuel. the legislative framework for american energy companies to dominate post war iran is already law
i already own OXY calls. been in since before the strikes. looking to take profits on the gap monday because i think the initial spike is where the easy money is. but im holding some april calls for the longer thesis
risks obviously — ceasefire could come faster than expected. trump says 4 weeks but who knows. OPEC could do an emergency meeting and actually release real supply. OXY also has significant debt from the anadarko deal so theyre not risk free even in a good environment
anyway thats my take. do whatever you want with it. i just think most people are going to wake up monday morning and panic search "oil stocks" and OXY is going to be the answer
positions: OXY calls. taking some profits monday, holding april expiration for the reconstruction thesis
Posted by downundafumunda