Oil & Anxiety: A Portfolio Manager’s Musings

Oil Rig

The market, currently resembling a startled flock of pigeons, is reacting to events in Iran as if someone had finally pointed out the obvious. Everyone’s scrambling for gold, which always feels… performative. Like dressing up for a disaster. Me? I’ve been staring at oil stocks. Not because I’m particularly optimistic about the future – let’s be honest, the future is mostly just a series of inconveniences – but because sometimes, the least dramatic option is also the most sensible. And, frankly, I’ve had enough drama this week. My neighbor decided to learn the bagpipes.

So, I started digging, which is what we do, isn’t it? Dig through financial statements, hoping to unearth something resembling stability. And I landed on two companies that, while not exactly beacons of hope, offer a reasonable path forward. Or, at least, a path that doesn’t involve bagpipes.

Chevron: The Steady Hand (and the 39-Year Streak)

Scott Levine keeps pointing to Chevron, and I have to admit, he has a point. It’s not the most exciting stock, let’s be honest. It’s the sensible cardigan of the portfolio world. But they’ve been raising their dividend for 39 years. Thirty-nine! That’s longer than I’ve been consistently flossing. It speaks to a certain… discipline. A refusal to succumb to impulse. Something I admire, given my recent online shopping habits. Apparently, I need a miniature replica of the Eiffel Tower.

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They claim they can stay afloat even if oil dips to $50 a barrel. That’s… reassuring. It suggests a level of preparedness that I, personally, lack. My emergency fund consists mostly of unopened boxes of pasta and a vague hope for the best. They’ve got operations all over the place – the Bakken, the Permian Basin, even Guyana. It’s a bit intimidating, honestly. All that global reach. I can barely manage to remember where I parked the car.

It’s a conservative play, yes. But sometimes, conservative is good. Sometimes, you just want a stock that won’t keep you up at night, wondering if you’ve made a terrible mistake. Like that time I tried to build a birdhouse from a kit. It ended badly for everyone involved.

Diamondback Energy: A Little Risky, But Intriguing

Lee Samaha keeps pushing Diamondback, and I’ll concede, there’s a logic to it. It’s a value stock, which means it’s currently undervalued. Which means, theoretically, it has room to grow. It’s a gamble, of course. All investing is a gamble, really. It’s just a matter of how much you’re willing to lose. I once lost a significant amount of money betting on a hamster race. Don’t ask.

They’re focused on the Permian Basin, which seems… sensible. A concentrated effort. They’ve got a solid balance sheet and generate a decent amount of cash. And their dividend is protected even if oil drops to $37 a barrel. That’s… encouraging. It suggests they’ve thought things through. Something I often fail to do before agreeing to volunteer for things.

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They estimate their free cash flow could range from $3.1 billion to $6.7 billion, depending on the price of oil. Numbers. They always make my head spin. But the point is, it looks… promising. At least, on paper. Everything looks good on paper. It’s the real world that’s the problem.

It’s a bit riskier than Chevron, yes. But sometimes, a little risk is worth the potential reward. Like trying a new restaurant. It might be terrible, but it might also be amazing. And even if it’s terrible, at least you have a story to tell.

So, Should You Fuel Up?

Look, everyone’s got different goals. If you’re looking for stability and a long-term income stream, Chevron is a solid choice. It’s the responsible adult in the room. If you’re willing to take on a little more risk for the potential of higher returns, Diamondback is worth considering. It’s the slightly rebellious teenager.

Ultimately, the decision is yours. Just remember, investing is a marathon, not a sprint. And sometimes, the best strategy is simply to avoid the bagpipes.

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2026-03-21 21:22