"The Difference Between Genius And Crazy Is Success" Featuring Gerald Kepes and Sudan Maccio

C.O.B. Tuesday

Today we were pleased to host Gerald Kepes, President of Competitive Energy Strategies, and Sudan Maccio, Chief Legal Counsel of PetroTal, for a discussion focused on Venezuelan politics, energy and economics. Jerry has over 40 years of experience as a consultant and petroleum geologist and is a regular contributor to Al-Monitor on the geopolitics of energy in the Middle East and North Africa. Sudan started his career at PDVSA and brings over 30 years of extensive legal experience in global energy across legal, commercial, and leadership roles. We were thrilled to bring Jerry and Sudan together to discuss the recent Venezuelan election.
In our conversation, Jerry and Sudan provide an overview of the recent election and the country’s opposition to President Maduro’s claimed victory. We discuss the current situation on the ground with ongoing protests, reactions from neighboring countries, the refugee crisis, how the military has been corrupted to support the ruling party and the potential for shifts in loyalty, and how the crisis is influencing global markets. We explore other geopolitical crises to understand potential strategy and outcomes, the possibilities and implications of foreign intervention, and influence from outside actors including Cuba, China, Russia, Iran and even Hezbollah. We also examine the role of the US in potentially intervening, possible outcomes, long-term implications, and much more. We ended by discussing how we can help the citizens of Venezuela and amplify their humanitarian needs. It was an enlightening discussion, and we are thankful to Jerry and Sudan for sharing their insights with us all.
Mike Bradley opened the conversation by highlighting that U.S. markets, so far this week, are mostly in churn-mode and laser focused on Wednesday’s FOMC Rate Decision Meeting. Bond traders expect the FED to leave interest rates unchanged but are hopeful Chairman Powell will indicate that the FED could be positioned, as early as September, to cut interest rates. WTI price has moved lower over the last few weeks due to growing fundamental concerns with 2H’24 oil demand (mostly slowing Chinese demand) but has plunged this week to ~$75/bbl mostly due to “technical” factors (Brent & WTI) breaking through 50/100/200 day moving averages which is leading to an unwind of “net” long interest in the crude complex. On the broader market front, he noted a continued rotation of AI/Big Tech names into the Russell 2000 due to a growing bet that the FED will be signaling a looser interest rate policy. The recent equity rotation could quickly unwind if the FED doesn’t signal a looser interest rate policy at the upcoming FOMC meeting. He also noted Q2 reporting up to this point has been dominated by Oil Services and natural-gas levered E&Ps but is now broadening out to all energy subsectors. He flagged a few key themes coming from Q2 calls including lower onshore oil service activity levels, a continuation of natural gas curtailments, and U.S. refiners highlighting that weaker refining cracks are resulting in global refining run cuts. Jeff Tillery also joined and added his perspective and inquiries to the discussion.
We hope you find the discussion as insightful as we did. Our thoughts and prayers are with the Venezuelan people and we are hopeful for a peaceful and democratic resolution.
Our best to you all. Thank you for your support and friendship!