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Oil. Oil rallied and went over $100 in the last couple of weeks, partly because of hurricane Isaac and the shutting in of oil production in the Gulf of Mexico. Also, there was the sabre rattling with Iran over the Straits of Hormuz. Both of these issues are now away so the price of oil has come back down to the $91 level. Inventories are very, very high. Now over 98 days of supply in the US. Also, inventories are at the high end of the five-year band in Europe and Asia. In the shoulder season between the summer driving and the strong winter demand we have too much inventory so expects the price of oil to back off, potentially below $80.

Natural gas. Nearby contract is in the $2.80 level and he expects it will back off a little because the withdrawal season doesn’t start until Nov1. There was a decent injection last week in the 60 BCF level so we are very close to the five-year average of injections. Also, we are much, much higher in storage than normal. Doesn’t believe it will go back to the sub $2 level. Shale production in the US is rising, but there are beginning to be signs that in some areas production is beginning to flatten out, and even decline. Demand is very strong, especially from the electrical industry.

Very good new management. Sold off Trinidad assets and paid down debt. Also, sold off land, at a very good price, in the Duvernay area. Really rationalizing down to light oil and liquids rich natural gas in Western Canada. Biggest part of their land base is in south-eastern Alberta. Also, had a big discovery in Tunisia. Stock is in the doldrums because of a commitment to drill, trying to farm it out and bring in new partners and if they can’t meet their deadline they will have to write a cheque to the Tunisian government. If the government gives them an extension and they get their partner, it is a very big discovery and important to the company.

Canadian Natural Resources (CNQ-T) or Crescent Point (CPG-T)? Both are good companies but in the case of Crescent Point you do have the higher yield. This one is more of a capital gains story. Have a lot of cash flow to pay down debt. Their Horizons project is moving smoothly now. As they pay down debt, they will probably have another growth spurt.

Canadian Natural Resources (CNQ-T) or Crescent Point (CPG-T)? Both are good companies. In this case you have the higher yield and they have been able to grow production so have been able to raise distributions over time. CNQ is more of a capital gains story.

Big fan of this company. In the process of bringing on the Brea field by the end of this year. They own 30% and a big German utility owns 70%. Also, going to start doing some offshore drilling in Romania. Stock has had a bit of strength recently. He has a $2.50 target, based on his view that a year from now they will be ramping up production from the Brea field and then maybe doing phase 2.

Have had a number of good things going on including bringing in new shareholders and the Garmian block that the Kurdistan government brought in. Now waiting for results from the Kurdiman #2 well of which they hold 40%. Next year there will be a lot of drilling as they are flush with cash. He has a $1.50 target. Expect it will be trading in a range here for a while until we get into the next phase of Q1 and Q2 of 2013

This company is involved in Kurdistan in a project of drilling with Niko Resources (NKO-T). They don’t have the capital they are going to need to continue drilling their project. It has been a yo-yo stock. With lack of capital and very, very expensive wells he would stay away.

This one gives you a yield. It is very impacted by the movement in the price of oil and the politics related to the oil sands. Very high beta relative to the commodity price. This or Canadian Natural Resources (CNQ-T) are good names to own if you want a long-term commitment to the oil sands. (See Top Picks.)

Missed their numbers in terms of growth on their heavy oil play in Albania.

(A Top Pick July 4/12.) Tax loss pressure could be pretty nasty this year on Junior gas so there will be some great bargains. (See Top Picks.)

(A Top Pick July 4/12. Up 1.79%.) Merging with WestFire Energy (WFE-T) in October, which makes a lot of sense. Likes this company longer-term. This is one you want to own for the long run.

(A Top Pick July 4/12. Down 5.46%.) Producing around 8500 BOE’s a day. Company is liquids rich. Has a very big land position in the Montne. Drilled some fabulous wells there that they are just trying to get comfortable with in terms of their production capacity over time and looking at using water-based fracs rather than oil-based to improve the overall numbers. Very cheap trading at a discount to NAV of $4.22 and Book Value of $1.91. (Buy a half weighted position now and take advantage of any market malaise in Nov/Dec to go to full position status on any weakness.)

Has been hit very hard, partially because of the issues with India as well as having a convertible debt that matures at the end of 2012. Trading very cheaply based on the Indian assets. There is much upside in the Indian assets with BP (BP-N) and Reliance as their partners. BP has been very positive on the global potential of the upside. Need to get a deal with the government on higher pricing. Also, have a large amount of land that they will be drilling next month in Indonesia. (Buy a half weighted position now and take advantage of any market malaise in Nov/Dec to go to full position status on any weakness.)

(Buy a half weighted position now and take advantage of any market malaise in Nov/Dec to go to full position status on any weakness.)