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Texas Tea

Let the Experts do the legwork for you. Ride the Wave. Oil is “where it’s at”, son. Don’t get left behind. I told you about $SRAQ, which now trades as $CDEV. Did you listen? Well? Were you paying attention, son? Listen to me when I’m talking to you, boy. Time for $SRUNU. Check your ego at the door, investing in an SPAC  is not for the timid. An IPO date has not been announced. This is your only warning from me regarding the awkwardly-named Silver Run Acquisition II.

Silver Run Acquisition Corporation II is a newly organized blank check company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not identified any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. We intend to focus our search for a target business in the energy industry.

You should be in early on this IPO. Living large in the company of Titans of the Crude Oil Industry. You rode the wave with Mark Papa. Now, you will roll  with James Hackett.
These people know what they are doing. And with WTI sub-50 this is our day, Bubba. Our Time. Set it and forget it. This is for your Smart Money, those bets you just file away and wait for the fruit to ripen. These are Texas Oil Men, just look at the résumé:

James T. Hackett will serve as our Chief Executive Officer and a director upon completion of this offering. Mr. Hackett is a Partner at Riverstone. Prior to joining Riverstone in 2013, Mr. Hackett served as the Chairman of the Board from 2006 to 2013 and the Chief Executive Officer from 2003 to 2012 of Anadarko Petroleum Corporation. Before joining Anadarko, Mr. Hackett served as President and Chief Operating Officer of Devon Energy Corporation, following its merger with Ocean Energy, where he had served as Chairman, President, and Chief Executive Officer. Mr. Hackett has held senior positions at Seagull, Duke Energy, and Pan Energy. He also held positions in engineering, finance and marketing with NGC Corp., Burlington Resources, and Amoco Oil Corp. Mr. Hackett serves on the Board of Directors of Enterprise Products Holdings, LLC, Fluor Corporation (NYSE: FLR), National Oilwell Varco, Inc. (NYSE: NOV), Sierra Oil and Gas and Riverstone Energy, Ltd. Mr. Hackett is a former Chairman of the Board of the Federal Reserve Bank of Dallas. Mr. Hackett received a Bachelor of Science degree from the University of Illinois in 1975 and an MBA from Harvard Business School in 1979. Mr. Hackett was selected to serve on the board of directors due to his significant leadership experience and his extensive experience in the energy industry.

I would expect a similar offering,  one Common and one Common w/Warrants. I’m guessing here. This is not a solicitation to buy. I have no financial ties to this company. Follow me at your own risk. Do your homework, for crissake. Don’t come crying to me if crude oil tanks to $25/bbl and your investment goes south. This is a long-term wager, son. $CDEV, in their own literature, states that they do not expect to turn a profit until 2019 or later.  I would expect the same from $SRUNU.

Here us your Form S-1. Read it and don’t expect me to decipher it for you. This us an IPO. SHIT CAN HAPPEN. But if the first go-round is an indication, the IPO will be priced correctly.

SET IT, FORGET IT, RINSE, REPEAT. We will sip Montrachet from the decks of our yachts in the Adriatic Sea while dining on caviar and oysters. Victory!

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This is fuckery of the highest order

Yeah, oil again. You can’t escape it. It’s behavior since March has often been baffling, to say the least. To say it has been trading purely on rumor and speculation is The Grand Understatement of 2016 (so far, plenty more to come before we ring in the new year).

Bit-players in this cesspool often claim it is a manipulated market. I have treated these people with scorn…until today. I am jumping on the bandwagon. The Fly said the other day, only half-joking, that he could imagine a shadowy individual in a ten-gallon hat, running from the scene of the fire up in the Alberta. After the Doha meeting (an attempt by OPEC members to “freeze” production at current absurd levels) fell apart, a “convenient” strike in the Kuwaiti oil fields tempered any blowback in futures. So with what should have been a hammer-blow to the futures price, with the Iranian and Saudi ministers throwing poop at one another on Al-Jazeera TV, the media focus quickly shifted to the effects that the Kuwaiti strike would have on the price. The strike was over in a very short time, with Kuwaiti officials mumbling dire warnings to the participants whilst brandishing those curved swords they like to carry around everywhere. No matter. The disaster that was Doha was quickly forgotten.

The crap being thrown about the room by the Asians re their currency has not exactly helped things, but so much more is in play here. And Grandma Yellin appears to be fading into the background as a relevant item in this discussion.

So here we are Dear Reader, left to stomp on this flaming bag of shit that someone left on the front porch after ringing the bell. The bell ringer, of course, being Tuesday’s API Reports which showed an unexpected rise in crude stocks, to the tune of 3.450M above forecast of .3M. Coupled with an unexpected rise in gasoline inventories of .271M at the start of traditional summer driving season. Distillates came in pretty close to consensus. In Normal Times, this would have been greeted with a big, fat meltdown in the front-month contract, but this time was different. This time the price went up, before settling back a bit, into range.

Today gave us yet another triple-digit bitch slap on Wall Street…but wait, wait…oil is what? Up by 3%?  What is this? Why, it is a -3.41M draw in crude stocks, courtesy of the Wednesday EIA reports. And look there, gasoline inventories have also depleted handsomely, down a robust -1.231M.

Throw in the Genscape flyovers which attempt to gauge tank levels via infrared scan earlier in the week (the Genscaoe numbers were also bearish) and you usually have plenty of data to help you decide which side of the trade will make you some money. But not this week. This week we have the smell of rotting fish, which seems to be confusing people.

Savvy futures traders can usually take both reports in the aggregate when playing the futures market. The Baker-Hughes weekly rig counts, while relevant, have diminished in importance as oil companies have made amazing efficiency gains during oil’s downturn since 2014. And the rate of idled rigs has slowed from it’s torrid pace in January.

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The smell of fish permeates this week’s supply data

I  mentioned back in April about my trepidation when the Dow hovers around 18000. Yet here we are in mid-May, bouncing around that number every damned day for the last month. Investors are showing some fear. But not the oil speculators.

How can the two numbers be off by almost 7M? How is this even possible?

From the API website:

Myth: API only collects data from its members.
Fact: API collects data from members and non-members.

Myth: API’s WSB is an estimate while EIA’s report is a census.
Fact: Both API and EIA do not collect 100% of the data. Both publish estimates.

Myth: “sometimes they [respondents] give the API incomplete data”.
Fact: API collects an exact copy of the data submitted to EIA.

Myth: API’s WSB estimates are not accurate.
Fact: Both API and EIA publish extremely accurate estimates every week. In fact – when looking at the 2012 data for Crude, Gasoline, and Distillate stocks – the monthly estimates are within 1% of each other 78% of the time. To verify API’s WSB data accuracy, we urge analysts and reporters to compare our WSB to the definitive numbers published in the EIA’s Petroleum Supply Monthly.

I smell fish. Rotting, stinky fish left on the pier, suitable for no one except the seagulls, who will consume anything.

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