@RaisingTheBAR47 @calvinfroedge With all due respect to @RaisingTheBAR47 (sincere), I’m going to side with @calvinfroedge.

The Latin majors look attractive to me, $PBR and $EC are formidable business that consistently generate superior ROIC and FCF relative to US/Euro majors and absolutely vs. US E&P. @RaisingTheBAR47 @calvinfroedge FCF generation at $PBR is absurd. They paid down $80B in debt since 2014 while dishing $60B in dividends ($50B last 2 years).

$XOM paid down $10B in debt and paid $120B in divs, current market cap is 8x $PBR.

$EC no slouch, paid 100% of current Mcap in divs since then.

1/4 Marathon Q3 letter released. Accred/Qualfd can sign up at MRAFunds.com or DM.

Theme #1- Support for pivoting asymmetry in crude markets: OPEC cutting into an economic downturn is NEW BEHAVIOR and indicative of a changed oil price dynamic. chart @CornerstoneOil 2/4 Theme #2- Metals markets inventories drawing similarly to energy despite China closures and economic slowdown- worth watching.

Theme #3- Expectations for rapid rate declines seem a tad optimistic, history says the road to +/-2% may be a long one

Sunday Musings:

Several weeks ago we wrote to our LPs that we believed the oil markets were transitioning from 40 years of having a firm ceiling and no floor towards having a firmer floor and a vastly diminished ceiling.

This week's Saudi comments support that view. Historically, OPEC increased production into economic downturns. The resulting downside volatility discouraged western investment.

Their willingness to reduce supply to make room for Iranian barrels indicates they no longer need to, as decarb/ESG sentiment achieves same goal.

Preview: Marathon Q1 (fashionably late edition) Resource Market Thoughts

Full fund commentary available to accredited/qualified investors, sign up at mrafunds.com

Hilights: Commodity markets were well on their way to shortages before the invasion of Ukraine. While most focused on the energy market impacts, we remain most concerned about the agricultural market ramifications.

Ukraine and the Energy Policy Problem - a 🧵+ 📽️

Why is it that the global reaction in the first days after the invasion of Ukraine was limited to toothless sanctions, sending “hopes and prayers,” and bathing buildings in blue and yellow light?

Why can’t we help them? 1/12 2/12 The answer is simple:

The western world has spent the last two decades making short-sighted energy and resource policy decisions that gave our adversaries substantial geopolitical leverage over us.