Europe Hastens for Energy Thanks to Russia
In their efforts to curb their reliance on Russian energy, Europe is absolutely loading up on non-Russian oil & natural gas ahead of tighter sanctions they will impose upon the country amidst the war in Ukraine.
According to energy markets data firm Vortexa, local terminals importing liquefied natural gas took in record amounts in the month of April. Additionally, imports of oil from non-Russian suppliers has hit the highest level since the onset of the COVID-19 pandemic. Europe is looking to boost imports of oil and natural gas from the likes of the U.S., Africa, the Middle East, and Asia.
Europe announced their plans as of late March, about 1 month after Russia had invaded Ukraine. Since then, they have literally been scrambling to acquire new sources of energy amidst their ban on the Russian Gas (not the good kind). While they haven’t finalized anything yet, they are hoping to completely decouple from Russian energy by the end of this year. Not to mention, this has resulted in obscene price inflation across the board for energy (commodities traders rejoice).
Not only are commodities traders rejoicing, but oil & gas companies have been reaping the benefits of the energy crunch that exists throughout Europe. Even with a painful loss of $25.5 Billion as a result of leaving their Russian holdings, BP reported $6.2 Billion in underlying profits Q1 2022. Kind of unreal to think about, tbh. And in stunning fashion, our favorite financial pundit Jimmy Cramer flip flopped on his view of oil & gas, after calling the market “A perma short” back in September of 2020.
One of these days I’ll start my own show where I make the most outlandish statements, which I’ll then directly contradict at some point in the future in hopes that nobody notices.
Big Jimmy isn’t the only one jumping on the oil & gas bandwagon, Berkshire Hathaway picked up 5.9 million shares of Occidental Petroleum stock on Monday and Tuesday, at prices ranging from $56-$58.37 per share. All of the whales seem to have no problem amassing some type of exposure to an industry that has been beaten down and neglected over the past 10 years. Remember when oil futures were negative? What a stark contrast from two years ago.