Have you read Tom Clancy’s thriller, “The Sum of All Fears”? Here is an up-to-date neuroscientific definition of what the title actually means:
Our human brain always looks for patterns in events so it can forecast outcomes. And true to human nature, we obsess about “bad things”, and the less accurate the forecast, the greater our fear. And the sum of our fears is the stress we feel.
Current events give us a laundry list of “bad things”. Here’s a representative sample:
- Covid-19: Do vaccines work? Should I get vaccinated? Is “Shelter-in-Place and Shutdown” good or bad? “Should students study at home or go back to brick-and-mortar schools? Is my job safe?
- Trump Impeachment: Is there a conspiracy that stole the election?
- Robinhood Trading Platform Kerfuffle: Can Website viewers use Social Media to manipulate stock prices? Can a “smart investor” make money this way?
- Cybercurrency/Bitcoin: Bitcoin price fluctuates wildly? Is there a way to “buy low and sell high”?
- Energy: Where does Oil & Gas fit? What about “Green Energy” and Electric Batteries? How does all this impact the economy?
We’ll stop here, but you see the picture. There’s a lot of stress in our lives.
We at Allied Resource Partners try not to worry about the first four items on the laundry list because we can’t control them and they don’t fit our Mission Statement. But the last one does.
Obviously, we don’t control the energy market. But we do operate in it for our partners and ourselves. And an overarching goal is to make money. That’s why we pay attention to current events in the oil patch in order to adjust, if need be, our strategy. Here’s a sample of energy current events:
- The oil price trajectory is upwards as evidence points to tightening Supply and increasing Demand.
- But the giant oil companies are warning that the World’s economic recovery from Covid-19 might be slower than hoped for.
- Meanwhile, there is plenty of uncertainty caused by Russia and Saudi Arabia, the major international oil companies (think about the canceled Exxon and Chevron merger), and domestic producers cutting back.
- A cleverly worded January WSJ article (Peak Oil? Not This Year. Or This Decade) pointed out that good environmental intentions take a back seat to consumers’ voting with their wallets. Oil and Gas will be a big piece of the energy mix for a long time.
- Major oil companies are revamping the boardroom and policies to be more socially responsible, meaning they’ll put the public ahead of profits.
- And the Auto Industry is gearing up for lithium-battery-powered vehicles because technological breakthroughs predict batteries will become safer, hold more energy, and cheaper.
We at Allied don’t claim to be smart enough to make these forecasts, but we are able to assess the “sum of all fears” by using past results and our “boots on the ground” approach for running our company and staying the course towards making money for our partners and ourselves. And all the above is telling us to keep doing what we are doing, which we repeat in the next paragraph
Allied Resource Partners:
We know that we operate in a small part of the Oil & Gas market, the domestic onshore segment that the major oil companies are shifting out of. But that means we can make our Oil & Gas projects a big piece of our financial success and wellbeing.
We are confident that our 2021 strategy will pay off for our partners and ourselves. Let’s state it again:
- Keep funding and drilling on the leases we already own.
- Keep looking for additional leases that we can pick up while the competition is running for cover.
- Keep improving the way we run our business so we make money for our partners and ourselves while strengthening our business network among partners, vendors, and consultants alike.
We’ve done this since I started the company, and we will continue to watch the current climate to make sure we are still going the right way. We take pride in being quicker and more proactive than any other Oil & Gas independent and believe our 2021 results will continue sending revenue to our Partners as well as to ourselves. We always put our own money in our projects.
Please contact us if you would like to hear more about what we have in mind for 2021.
President, Allied Resource Partners