RE:Shorts why are they shorting.So if you believe WTI will drop to $50 and go lower for a longer period of time, shorting makes sense and shorts are betting VET divvy will be cut. VET is trading at a premium becuase of the divvy. If oil prices drop, it will have the hardest fall as compared to its peers.
I personally feel Oil bottomed a few months back and we are going to rise to $60+ for WTi and closer to $70 for Brent.
I dont think VET divvy will be cut and I also think tax loss selling has already happened for VET. It hasnt fallen 10+pct like I thought it would and has been hovering in the 18.75-19.75 range. If we break $20 it will move higher and you will see short covering happening.
Other notes
1. Rig counts down large in the US
2. OPEC+ cut of an addtional 500,000 barrels/day
3. Aramco valuation hit 2 Trillion today. Saudi's need oil prices higher
4. General sentiment and talk of the Energy sector is now happening on alot of news outlets
5. Rotation out of weed stock into beaten up sectors such as energy
6. US Shale estimates are being revised down
This is a good time go get into beaten up oil companies and you will see alot of Free Cash Flow in the coming quarters.
Those are my thoughts only.
Good luck
Shakka