Our First Trade, 57% Profit Booked.

On June 29th, with oil at $75 and the market sure the war was about to end, I bought Exxon (XOM) and some oil futures options spreads for my members. It was the first trade this book ever made. I made that alert public a few weeks later — you can still read it here.

Today we sold every share. Roughly 25% on the position, in a little over three months.

The options returns were far better. The call spreads on crude oil futures bet oil was underpriced by at least $15. It was. We took profits on it in stages over the summer and closed out the last of it a few weeks ago, for roughly 240% on the capital we put in.

That's a 57% return on the concatenate trade in three months. That's pretty good, in anyone's book. But at least for now, we’re done with oil.

It's not that I'm bearish. The world's crude stockpiles — in China, in Japan, here in the US — have covered the supply shortfall from the Strait of Hormuz for most of this year, and they're going to need serious refilling well into next year. That's a floor in price. Don’t expect to see $2.75 gas again soon.

But today, Exxon is priced for a war that never ends. Attacks on tankers around Hormuz are at their highest since the war began. The war premium is at its highest. The rhetoric is at its highest. And both sides are looking for a way out — an American electorate that's had enough, and an Iran sitting in an economic hellhole. I think they’ll find it after the midterms.

Strikes at the top. Premiums at the top. Rhetoric at the top.

That’s when I look to take profits. Not after the headlines turn.

I know – you don’t care about a trade you didn’t have. You care about the next one you can have.

The next trade

So, here's what I'm watching now.

Europe went into October with its gas storage at a record low for the date. It's on track to come out of winter nearly empty — with Russian LNG banned from January and the world's biggest LNG exporter still offline. Next summer, Europe has to refill from close to zero, bidding against Asia for every cargo on the water, and that's if the winter stays mild. Supply projections for 2027 and beyond are betting on the completion of just about every ongoing project, with rose-colored confidence, just to get close to projected demand. All of this while capital is growing scarcer and more expensive, both here and abroad. Man, the arguments for a continuing hard-asset inflation trade have only gotten stronger, from where I sit.

Oil was and is experiencing a temporary bottleneck. Natural gas, not oil, is where the real money in fossil fuels gets made next year and beyond. And I don't think the market has priced what next summer's refill is going to look like, to begin with.

I'm not in it yet — on purpose. The same peace that takes the war premium out of oil will knock the gas names down with it, at least for a moment. MEP has rotated the oil winnings back into cash, waiting for that moment.

When it comes, we’ll be ready with the names, the allocations and the time frames. That’s the next trade you CAN have.

Membership is $2,500 a year. It's capped at 50 members, and there aren't many seats left. If you can't put at least $50,000 to $100,000 behind these ideas, it's probably not for you — and I'd rather tell you that now than disappoint you later.

If you missed the oil trade, the gas trade is the one to catch. Don’t miss this next investment — I expect it to be even better than the first.

Join here → members.dandicker.com

Let me know if there’s anything I can answer.

dan@dandicker.com