Blog
EUROPE’S ENERGY CRISIS IS KEEPING ENERGY PRICES HIGH
America leads the world in oil and gas production. We believe midstream energy infrastructure offers predictable cash flows to investors.
The Upside Case for Pipelines
Client interaction has been overwhelmingly constructive – we haven’t had a single call from anyone wanting to “sell everything.” Our fund has seen very modest net outflows, and new money has been coming in every day. One investor said on the weekend that we need to present the positive case more forcefully. So, here it […]
Coronavirus Makes Market History
Thursday’s fall in equity markets was the worst since the October 19th, 1987 stock market crash. I was a young interest rate trader then, and that evening I warned my wife that we should stock up on canned food while we prepared for another 1930s Depression. She scoffed that only Wall Street had a problem, […]
Update Thursday, March 12th, 10:30am
Bankruptcy risk is the topic investors want to discuss in calls this week. Within the American Energy Independence Index, the pipeline industry is 80% investment grade companies. We estimate that around 20% of it is direct exposure to crude oil pipelines. 80% of their customers are themselves investment grade. During the 2008 financial crisis, crude […]
With Energy Uncertainty, Natural Gas Offers Stability
The spreading coronavirus and effective end of OPEC+ were a one-two punch that caused the worst collapse in midstream energy infrastructure stocks any of us have ever seen. The IEA forecasts a 2.5 Million Barrels per Day (MMB/D) drop in demand for 1Q20, but clearly oil markets are pricing a bigger drop. Medical experts typically […]
Quick Update After OPEC+ Collapse
Yesterday’s blog on the positive free cash flow story was largely written before Saturday’s news that precipitated today’s sharp sell off. It’s doubtful any company would reaffirm prior guidance if asked right now. Investment grade names are better to own than high yield issuers; exposure to natural gas infrastructure is better than crude oil pipelines; […]