evening wrap

market vibes

January 17… )

“I was born for the storm. A calm does not suit me.” Andrew Jackson March,1829

The last day of trading in the Biden years goes into the archives. To recap it all would take more than the author of a daily wrap could ever bite off and chew. But it has been a week well worthy of review before we go down the rapids of time into the Trump era 2.0.

Where to begin? On Monday january 13, the Treasury put severe sanctions on Russia, so called. WTI rallied $2.50. Front spreads ripped higher, product cracks, especially gasoline cracks plunged. However, WTI prices had been moving higher for two weeks without any information as to why. It seems obvious to me in hindsight, the sanctions were leaked to insiders, not an uncommon practice in Washington DC, who sold into the news.

Oil

A drilling ban announced on the same date, January 13, was ignored. Baker Hughes (BRK $46.55) rallied 17% since Jan 2 and 9% since the ban was announced. It seems obvious to me that, either buyers of drilling stocks knew the ban was coming or they didn’t care.

No one spends a few million for a basic drill if they don’t plan to use it. For example: In the Permian Basin, the cost for drilling and completing a well with a 10,000-foot lateral, runs around $5 to $9 million. Offshore wells run 100 million and up.

Baker Hughes all time high was $50.35, on October 16, 2007.

Van Eck’s OIH services ETF is up 20% in 2025, and just missed breaking its 200 D MA today. All time highs are circa $1157.00 in July 2014 before the plunge from $100/ barrel.

If you see a dollar in the street, bend down and pick it up.

Bitcoin. Gold, Bonds, Canadian Dollars, DXY, and the Dow Jones industrials are up next.