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October 2022 – Commentary from Dan Pickering

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Payback. October was a strong recovery month for risk assets, with energy extending its YTD outperformance. The energy environment remains s

Payback. October was a strong recovery month for risk assets, with energy extending its YTD outperformance. The energy environment remains simultaneously simple and incredibly nuanced…

The above information does not constitute investment advice. Please note that these unaudited estimates have been prepared in accordance with our typical procedures for estimates and as such, final month-end prices may not have been received for all positions. Performance for all strategies is net of fees. Returns have been adjusted where applicable to reflect the highest level of fees available.  The PEP Energy Equity Opportunities strategy performance is that of an investor invested in the USD share class of the one-year tranche. The performance calculation assumes that the investor’s account participated fully, on an applicable pro forma basis, in all investments, and was assessed a 1% management fee and 10% incentive fee. Additionally, the performance calculation assumes that all investors were given the same economic terms with respect to their investment. From Inception (May 1, 2022) the performance of the PEP TE&M Opportunities Fund is calculated pro forma to represent the highest fee level offered for the strategy. The performance calculation assumes that the investor’s account participated fully, on an applicable pro forma basis, in all investments, and was assessed a 1.5% management fee and 20% incentive fee subject to high water mark. Additionally, the performance calculation assumes that all investors were given the same economic terms with respect to their investment. Individual investors’ returns will vary from the strategy returns due to the timing of subscriptions and redemptions. Indexes are unmanaged and have no fees or expenses. An investment cannot be made directly in an index. The strategies represented consist of securities which may vary significantly from those in the indices listed in the Estimated Net Performance Benchmark chart, and performance calculation methods may not be entirely comparable.  Accordingly, comparing results shown to those of the aforementioned indices may be of limited use. Please refer to fund documents for terms and appropriate risk disclosures. As a reminder, please note that the information provided is confidential and should not be forwarded or distributed by any recipient. If you would like to add someone to the distribution list or have any questions, please feel free to contact us at ClientServices@PickeringEnergyPartners.com.

October 2022 – Commentary from Dan Pickering

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Analysts say the Iran war could drag on through November’s midterms as stalled peace talks and Tehran’s push for leverage prolong the conflict.
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More tankers are moving through the Strait of Hormuz as shippers gain confidence, but the global supply of oil is still below demand.
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An export ban likely would slow U.S. refining and eventually push up all fuel prices, including gasoline, jet fuel, and diesel.
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Oil futures don’t tell the whole story. The Iran war is tightening crude supplies, widening the gap between benchmark prices and what buyers actually pay.
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Pickering Energy Partners advised ConocoPhillips on the sale of non-operated Permian EOR assets in Gaines and Yoakum Counties, Texas.
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Diesel prices are surging as wars in Iran and Ukraine disrupt fuel supplies. Analysts explain why the Iran war is the bigger driver of rising costs.
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California diesel prices average $7.91 a gallon, with several stations charging over $9 and some pump displays hitting their $9.999 limit, GasBuddy reports.
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Analysts warn the escalating Iran war could deepen global fuel shortages, push diesel prices higher and intensify inflation as energy supplies dwindle.
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Dan Pickering expects the Iran conflict to outlast U.S. midterms, keeping oil prices elevated amid China’s return and risks to Saudi oil supplies.
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Relentlessly rising fuel costs are feeding inflation and threatening Republican reelection chances.
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Chevron and SLB have signed major Venezuela oil deals, but political uncertainty and financial risks are keeping smaller Houston firms on the sidelines.
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The oil outlook has shifted from potential surplus to sustained tightness—and Dan Pickering does not expect a quick return to the market that existed before the fighting in Iran began earlier this year.
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