Author presents long oil-services/refining theses on Halliburton, Schlumberger and Valero plus watch ideas on ConocoPhillips and a conditional Chevron fade.
CVX — WATCH Author sees a conditional fade: CVX may spike at Monday's open because Chevron already has infrastructure in Venezuela. After the news fades, the stock could go down as added Venezuelan supply floods an already oversupplied oil market.
I think Chevron CVX is potentially the winner here as they’re already on the ground in Venezuela and have infrastructure there, I can see a spike with CVX on opening on Monday but I think when the news fades it could go down and I believe this could be the same for Crude Oil, I think investors will remember when the news fades that the oil market is already flooded with oil and in Venezuelas oil floods the market it will drive oil prices down further.
HAL — LONG Author argues Halliburton will repair existing Venezuelan pipelines and pumps because it already has infrastructure there and will support Chevron's drilling. Because Halliburton does not sell oil, it avoids oil-price volatility. He expects it to be profitable over the next 6-12 months, with US Treasury contracts as a catalyst once sanctions are lifted.
Halliburton HAL will be sent to repair the existing pipelines and pump. HAL will fix everything and they already have existing infrastructure in Venezuela. They will also support Chevrons drilling. I believe HAL could be profitable to hold for the next 6 - 12 months
SLB — LONG Author sees SLB as the 'brains' of Venezuela extraction because it has unique technology to detect remaining oil fields and plan extraction/mapping. It does not sell oil, so it avoids oil-price volatility, and he expects it to be a good hold for the next 6-18 months.
SLB is the “brains” of the operation, SLB has the technology to detect all of Venezuelas remaining oil field, especially the oil in the hard to reach places and SLB plans the extraction and maps everything. No company has the technology SLB does.
VLO — LONG Author argues Valero specializes in refining Venezuela's heavy crude products. He expects this to support significantly higher long-term profits.
One refinery in particular I am looking at it Valero VLO, they specialize in refining Venezuela heavy crude products, this could be a good long term play as profits will spike significantly long term.
COP — WATCH Author notes ConocoPhillips had assets seized in Venezuela under the Maduro regime and is owed $10 billion, and he believes it will definitely get restitution. He suggests watching it for that recovery catalyst.
Another one to watch could be ConocoPhillips COP as they were an oil company involved in Venezuela many years ago and their equipment and assets were seized under the Moduro regime and are owed $10 billion because of this by Venezuela so I believe they will definitely get restitution.