oil companies
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Oil Companies Hope for New Opportunity in Energy-Rich Venezuela
One of the biggest headlines recently related to oil companies was news of the passing of Venezuelan President Hugo Chavez.
"El Commandante" as he was affectionately referred to by his countrymen, at least by those who approved of his leftist policies, was 58 and succumbed to a lengthy battle with cancer.
Predictably, news of Chavez's passing has sparked ample speculation about what the future holds for Venezuela's oil industry and those oil companies looking to profit from a possible renaissance there.
Venezuela is South America's largest oil producer and an OPEC member. In what may come as a surprise to some investors, Venezuela could be called the Saudi Arabia of OPEC.
In other words, the South American nation is home to about 300 billion barrels of proven oil reserves, compared to about 270 billion barrels in Saudi Arabia. That is according to OPEC's own estimate.
Not only that, but Venezuela is home to the largest natural gas reserves in the Western Hemisphere.
Given those superlatives, it is easy to understand why some Western oil companies are cautiously optimistic about what the future may hold for them in Venezuela.
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The Doomsayers Are Wrong About Oil Prices
The stock market is not the only thing that is up. Crude oil prices have jumped as well rising faster than the S&P for the past month.
West Texas Intermediate (WTI) next month futures contract prices for crude oil on the NYMEX increased again last week. That marked the seventh consecutive week oil prices have gained, the first time that has happened since 2009. Overall, WTI pricing level has risen 11% since mid-December.
Now all of this means something pretty important. As we've known for a while now, the oil market has been oversold with values unusually low. This has largely resulted from concerns over demand related to the ongoing recovery/recession debate.
However, that debate has never been a particularly genuine one, certainly not for the last two quarters.
Yes, if we fell off a fiscal cliff or ran into a budgetary wall or failed to raise the debt ceiling and the living room chandelier fell on our heads there would be some substance in the Chicken Little approach to market analysis.
But we haven't, and, we won't.
With Congressional approval ratings just above those of Attila the Hun, they will slink in, kick some cans down the street, and slink out. That means the penumbra behind which the doomsayers have operated is no longer worth the smoke and mirrors it is based upon.
Here's why...
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Shale Oil Stocks are Poised to Earn Investors Big Profits
With oil production soaring in the United States, shale oil stocks will be pumping out profits for years to come.
It's all thanks to huge deposits of shale oil.
At least four new major shale oil plays including the Bakken in Montana and North Dakota, the Eagle Ford in Texas, and the Marcellus in Pennsylvania and New York, may have more than 20 billion barrels each of recoverable oil.
Each of these new shale oil plays has the potential to double the total reserves we have today.
In fact, the "shale oil revolution" will soon make the United States the world's leading producer of crude oil, a report from Goldman Sachs Group Inc. (NYSE: GS) recently predicted.
The United States will produce more than 10.7 million barrels of oil per day by 2017, the report said. That's more than any other country, including Saudi Arabia.
And even though oil prices are in a short-term swoon, the glut of shale oil is about to make savvy investors a huge fortune.
That's why you need to take a hard look at a particular group of shale oil stocks that stand to benefit most from this boom.
But first, you need to know how this came about.
To continue reading, please click here...
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Oil Companies: The Search for Unconventional Sources Goes Into the Arctic
The black gold rush on the roof of the world accelerated on Saturday.
Norway's Statoil ASA (NYSE ADR: STO) signed a massive deal with Russian behemoth Rosneft in a venture that may require more than $100 billion over the next few decades.
Specifically, the company aims to help Rosneft develop untapped oil resources in the Arctic, as Moscow struggles to gain a competitive advantage given declining oil production in Siberia.
It's the third recent oil partnership for Rosneft.
Reuters reports:
"The agreement, signed on Saturday, provided a showcase for president-elect Vladimir Putin, serving out his final days as prime minister before a May 7 inauguration, and Deputy Prime Minister Igor Sechin, in charge of energy and industrial policy.
As a legacy of their time in government, the three deals secure capital and expertise for a push into some of the world's potentially most energy-rich regions."
The deal highlights a number of key issues for both oil companies and Moscow moving forward.
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Four Natural Gas Companies Investors Can Buy Right Now
Natural gas companies are hurting - there's no doubt about it. But that doesn't mean natural gas companies are bad investments.
In fact, some of these companies are currently on the bargain rack. You just have to know where to look.
Take EOG Resources Inc. (NYSE: EOG), for instance.
Traditionally known as a natural gas producer, EOG has reinvented itself as a major oil producer.
It's still heavily involved in the natural gas market, but the company also has managed to increase its total liquid oil production by 49% to 130,000 barrels per day.
Chief Executive Officer Mark G. Papa said he expects to reach 200,000 barrels per day this year. That would make EOG the second- or third-largest oil producer in the United States.
The effects of this transformation are evident in the company's earnings.
After taking a third-quarter loss of $70.9 million in 2010, EOG reported net income of $541 million for the third quarter of 2011.
That's not all. EOG's potential for growth is outstanding, since it has huge oil shale reserves. The company is the largest oil producer in both North Dakota's Bakken Shale and the Eagle Ford Shale in South Texas.
These two shale oil fields have played a key role in ramping up U.S. oil production over the past few years. They each have an estimated 4 billion barrels of recoverable reserves.
Earlier this month, analysts from Goldman Sachs Group Inc. (NYSE: GS) raised their EOG share price target to $118, while RBC Capital Markets (NYSE: RY) analysts set their target at $119. Those targets estimates represent a 13% to 14% premium from yesterday's (Tuesday's) closing price of $104.55.
And that's just one natural gas company with a strong investment pedigree.
Here are three others... To continue reading, please click here... -
Gasoline Price Outlook: An Epitaph For Sam the Service Station Man
I am a great believer in the American entrepreneurial spirit. In fact, the U.S. economy stands or falls on our ability to provide enough space to allow small folks to have big-time dreams.
However, when times get difficult, some little folks end up under the bus - along with their dreams.
To understand what I mean, let's take a look at my friend Sam.
Many of you may remember Sam, the proprietor of an out-of-the-way rural service station situated outside of Pittsburgh. I introduced him to Money Morning readers last summer in an essay: Gasoline-Price Forecasting: What Sam the Gas Station Owner Knows That We Don't.
I've known Sam for years.
So I was stunned to discover that he's throwing in the towel.
To understand what this means for gasoline prices, please click here...
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Oil Patch Outlook: Oil's March Madness a Boost for Refiners
March Madness is still a few weeks away for college basketball fans, but the madness of March is in full swing for the oil sector. Turmoil in the Middle East sent oil prices up more than 6% last week - following a 5.2% gain in February. We also happen to be entering a time of year that has historically been good for energy prices and energy equities in recent decades.
Going back nearly 30 years - as the preceding graphic illustrates - March has been the best month for crude oil. By the end of the month, the price of oil is nearly 4% higher on average than the closing price on the last trading day of February.
