The Romney USD/Energy Play

We hosted an expert call with Ken Bickers on the November election  this week and the outcome of his model shows Romney winning by a landslide. Romney says he would open up drilling on federal lands and offshore - that’s great for energy, right? Not really. A Romney win is bullish for the US dollar and when the dollar goes up, oil goes down; correlation is a beautiful thing.

From Hedgeye Energy Analyst Kevin Kaiser, here are the winners and losers if Romney wins the election:

  • Relative losers: crude oil E&Ps, refiners, oilfield services, renewables/clean.  Oil prices fall and Romney cuts subsidies to the renewable/clean energy companies.  Less regulation, more offshore drilling, Keystone XL, and a better tax environment are all well and good – but won’t move the stocks.
  • Relative winners: coal producers.  Romney is pro-coal, opposing looming EPA

The Romney USD/Energy Play  - energyUSD