Special Report: Trust but Verify

Oct 14

In the distant past when the energy industry was trading old oil versus new oil and “cert” trading, there was occasions where who said what when was important. The terms of a deal hinged on a verbal acknowledgment that was subsequently questioned. The deal failed. The lesson learned (and remembered) is to document future activities so accusations of “Monday morning quarterbacking” and he said/she said commentary is avoided. Infinity Power Partners has long since archived “Insights” and other internal publications in response. What this allows is verification of what was said, not that it’s always right, but that it is always consistent in its release.

2021 has been an interesting and sometimes surprising path for prices. It began in a tight range that traded defensively.[1] That lackluster trade continued.[2] The coming of cold weather (“Polar Vortex”) offered a demand side piece but even that had its limitations[3] although with hints of things to come.[4]

The impact of the February freeze in Texas brought home some lessons about risk and what had been acceptable no longer seemed prudent.[5] As June rolled into view, there seemed to be indications of change but without conclusive evidence (but LMP is continuing to be suspect).[6] Sideways action continued through the month and with the first of July we determine that a bull move is underway, something not experienced since 2006 – 2008.[7] Follow-up trading confirmed the bull market call.[8]

When providing counsel regarding procurement, timing is a key element. Certain actions may be interpreted in a variety of ways, so we provide commentary with the intent of helping decisions as to when to pull the trigger.[9] That commentary is a flow of information highlighting twists and turns in the market that might otherwise confuse.[10] In addition to clearing up confusion, confirmation is helpful and provided.[11] When exceptional events push prices, they deserve details and explanations. Such was the background for Hurricane “Ida”[12] and later “Nicholas”.[13] Where it makes sense and provides clarity, we proffer experiences and observations.[14]

Our objective for this discussion is to give insight into our advantages as a consultant. It is important to us that our clients trust and depend on our advice and services. Knowing that transparency and honest efforts are a given, our client base has the reliance of a trusted partner.