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00:00Is it that its shareholders are demanding that they produce less because they want the higher oil price? They want the buybacks, for example? Or is it an issue with the upstream? You can't get the oil out is too expensive. You have an idea? Well, I mean, look, we don't have the specifics yet. We're waiting for the call. But you know what? It will says the Permian is growing in line with expectations. US volumes are down and international volumes are down. And it doesn't seem to be Kazakhstan. It's a little bit tricky because, you know, everything's clumped and into big groups and it's hard to parse exactly where the volume weakness is coming from. The other aspect here, as I mentioned, is that Chevron is upstream weighted. So what you've seen yesterday was really superb results from Valero, which bodes very well for Exxon. In fact, people were expecting a lot from Valero because of the Exxon guidance. And finally, Chevron doesn't guide anymore, whereas Exxon does. So this comes a bit of a negative surprise when they come out with with their earnings, because we really haven't had any guidance about what's going to happen. Paul Allen report just says to our report, just the average is very important. There's a real suspicion in my mind at least that they announced this massive 75 billion dollar buyback as a smokescreen for the results. Because if you listen to the company's guidance, the 5 to 15 billion dollar a year buyback, which they had previously guided to, is unchanged. They're at the top end of the 15 billion per annum buyback. But essentially, what they've done here is told you about the next five years of buyback, which I frankly think was politically a mistake, because you're bringing attention to a five year program with board approval that you really didn't need to. I mean, I think that just attracts know windfall profit tax cries where there's actually no UPS upgrade to their buyback guidance in terms of the outlook for next year. So is this as good as it gets? Do you think, Paul, for Chevron, did the stocks had an incredible run? Is this as good as it gets? No, not really, because, you know, we're bullish oil, but everybody else is, too. But obviously, at the moment, we think that the group is discounting about 80 dollar oil, which is not far off where we are essentially, although, of course, as you know, we're now beginning to head towards 90 dollar brand and we've been calling for one hundred and twenty dollar Brent by driving season, which is pretty aggressive. And having said that, everybody everybody's more or less bullish going into driving season here. We're waiting for the Russian products export ban to kick in next week, which could tighten things up. So I think from an oil price point of view, the question is to these stocks start discounting a higher long term oil price. If we start, for example, moving towards a sustained hundred dollar barrel environment and you know, that's that's a big question about the economy and everything else in terms of the demand side. But the supply side, as you can see from Chevron's results, is extremely challenged. And yet if demand remains as high as we think it will with a billion people in the world, we could well be moving into an era of 100 dollar oil. And all of these stocks need to go up probably another 20 percent at least.

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Chevron Buyback May Be 'Smokescreen': Analyst Sankey

Paul Sankey, lead analyst at Sankey Research, reacts to Chevron's fourth-quarter results and $75 billion share-buyback program. Speaking with Alix Steel and Guy Johnson on "Bloomberg Markets," Sankey also says energy stocks may increase another 20% at least. (Source: Bloomberg)

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