Hardly anybody is talking about this. The world's two oil benchmarks are moving in opposite directions. The price of crude in New York is going south, while the price in London is heading north. It's a rare disconnect that can lead directly to profits -
best oil stocks to buy
- Make This Oil Move Immediately
- How Gold, Oil, and Syria Really Mix... Plus "3 Strikes Against Apple"
- Oil Forecast: The "Syrian Premium" Is Not Temporary
- How to Play Oil Prices Today
- How to Play the 'Syrian Premium' in Oil Prices
- Best Stocks to Buy Now to Profit from This 30-Billion Barrel Oil Field
- How to Find the Best Investments in Shale Oil
- How Syria Affects Oil Prices Today
- Jim Rogers on Why Oil and Gold Are Headed "Much Higher"
- 2013 Oil Prices: Where We Go From Here
- The Shale Oil Boom is Going Global (Starting With This Huge Deal in Argentina)
- Shale Oil Stocks are Poised to Earn Investors Big Profits
- The Top Five Eagle Ford Shale Oil Stocks
- Ride the Boom With These 5 Bakken Oil Shale Stocks
- How to Profit from the "Shale Oil Bubble"
The shale oil and gas boom is going global, as we explored Tuesday in Money Morning.
And this means huge profit opportunities for those who know how to invest in this global shale revolution.
From the Editor: In yesterday's members-only message, you got a rare look at Kent's track record and why he averages 55% on every recommendation. Today, Kent recommends a short-term move, based on the latest developments in Syria...
Damascus may have dodged a bullet (or a cruise missile), but nothing else has changed very much. Not in terms of risk.
That explains why the "Syrian Premium" remains. It may be slightly reduced, as you'll see. But it is likely to stay with us even after the threat of a military solution has been averted.
The markets are very complicated at the moment, which is why now's an ideal time to reach into the Money Morning Mailbag and address your concerns.
The goal here is simple: To provide understandable, actionable, and, of course, profitable answers to your thoughtful and extremely insightful questions.
By an apparent agreement to place its chemical weapons under international control, Syria seems to have dodged an imminent American military attack.
Yet even as the world takes a step back from the brink, three critical questions still remain:
1. Will Syrian President Bashar Assad hand over all of his chemical weapons?
2. Will the proposed international control mechanisms satisfy Washington?
3. Will the final result contained in the U.N. report on the chemical weapons use outside of Damascus alter the outcome?
Of course, until the latest news hit, one result had seemed certain: The global oil market was bracing for higher prices. West Texas Intermediate (WTI) closed at a 28-month high on Friday, while Brent crossed the $116 a barrel level.
Following the agreement, that trend has reversed, sending oil prices in both New York and London lower.
But has this crisis really been defused?
There's an uneasy lull in the Syrian crisis.
Now that the Obama administration has decided to seek Congressional approval for a Syrian strike, we are in a hazy period before some major decisions are made.
And while a Senate committee has approved a military move against Syria, further action will be slow to come. Congress is officially on recess until Monday.
One sign that the U.S. shale oil boom is still in its infancy is that major new discoveries are being made all the time. The most recent, located in Texas, is believed have three times as much recoverable oil as such well-known formations as the Bakken and Eagle Ford. The companies that got there first figure to profit the most. And we know who they are...
Some of the best investment opportunities today are in the energy sector. And there's one area in particular that's becoming so lucrative companies are tripping over each other to take part in it. But which are the best investments? We can tell you exactly where to start looking...
As U.S. military personnel prepare for possible action against Syria, Brent oil prices are hovering near an 18-month high.
On Thursday, Brent oil prices retreated slightly, but remained elevated, after starting the day above $116 a barrel. Prices for West Texas Intermediate (WTI) also retreated by a little more than 1%, closing the day at $108.80.
Brent prices have climbed steadily following escalations across Egypt and the ousting of President Mohamed Morsi.
Meanwhile, in the United States, improved infrastructure and greater network access have fueled WTI prices to near par with Brent this month.
But Brent prices have spiked this week following news that the West may intervene in Syria, where a chemical attack was allegedly launched against civilians.
Despite warnings from Russia and China, it remains unclear whether the United States will intervene. However, any action is likely to set off a chain reaction across the Middle East and could affect trade within the region, especially on oil shipments.
Here are the details on how Syria affects oil prices, what that means for you - and how to profit.
Legendary commodity investor Jim Rogers sees some serious problems stemming from the situation in Syria and the end of the Fed's generous flow of money.
In an interview with Reuters on Tuesday, Rogers said "oil and gold will go much, much higher" due to a "market panic."
"I own oil, I own gold, I own things like that and if there is going to be a war, and it sounds like America is desperate to have a war, they're going to go much, much higher," Rogers said. "Stocks are going to go down, some of the markets that I'm sure are already going down, commodities are going to go up. I'm not particularly keen on war, I assure you, but it sounds like they want it."
Rogers continued, "No matter how well the plans are made, strange things happen in war and who knows what unintended consequence will come."
Equities have been hit hard over worries of a war with Syria. The rout started late Monday following comments from U.S. Secretary of State John Kerry that the United States has a moral obligation to act on Syria's chemical weapon attacks. Selling picked up steam Tuesday with the Dow plunging 170 points.
You can tell a lot about crude oil prices by studying one key pattern - a pattern that has abruptly reversed of late. The reasons for the sudden change could have a profound impact on energy investors...
The U.S. and Canada dominate the shale oil boom, but that’s about to change. Dr. Kent Moors details where these other big shale oil reserves reside.
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.
Recently Money Morning told you about the Bakken oil shale boom. The Eagle Ford shale oil formation in south Texas is nearly as large, and production there is ramping up rapidly.
Eagle Ford is among the largest U.S. shale oil deposits, with recoverable reserves estimated as high as 7 billion to 10 billion barrels.
But Eagle Ford is also "liquids-rich." That means it has a high concentration of oil versus gas -- a major attraction at a time when oil prices are high and natural gas prices are at historic lows.
Many oil companies are eager to get in on the action at Eagle Ford, and expectations are running high.
"We are evaluating a series of projects ... that could literally double our company's earnings over the next few years," Curt Anastasio, CEO of NuStar Energy (NYSE: NS), told Reuters.
Another oil company CEO, Bill Klesse of Valero Energy Corp. (NYSE: VLO), thinks Eagle Ford could have an impact even beyond bigger profits.
"It's going to back out sweet crude imports into the United States, and that's going to happen by 2014," Klesse predicted, speaking at Valero's annual meeting earlier this month.
Indeed, the statistics coming out surrounding the Eagle Ford shale oil operations are impressive.
Data from the Texas Railroad Commission, which regulates energy in the state, tells an amazing story. Shale oil production increased nearly seven-fold from 2010 to 2011, from an average of just less than 12,000 barrels a day to about 83,400 barrels a day.
And that could explode to 500,000 barrels a day by the end of 2012, Klesse said, with output expected to double to 1 million barrels a day "in the next few years."
Impact of Eagle Ford Shale Oil UnderestimatedEagle Ford has progressed so quickly that a forecast of its economic benefits became outdated almost as soon as it was issued last year.
A study by the Center for Community and Business Research at the University of Texas San Antonio's Institute for Economic Development in early 2011 projected the Eagle Ford formation would directly and indirectly contribute $21.5 billion and 68,000 full-time jobs to the 20-county South Texas region by 2020.
Last week UTSA released a follow-up study.
It found the Eagle Ford contributed $25 billion to the local economy in 2011 -- $3.5 billion more than the 2020 projection.
The new UTSA study says Eagle Ford will pump about $62.3 billion into the local economy by 2021. The job creation number increased to nearly 117,000.
"We view the Eagle Ford activity as an economic opportunity of a lifetime," said Mario Hernandez, president of the San Antonio Economic Development Foundation. "The key goal is the increase in investment and jobs. And if the communities will partner with the private companies that are creating these jobs, it can be a win-win for everybody."
Growth that outruns forecasts is good news for investors. Money Morning has sorted through the many choices to zero in on five Eagle Ford shale oil stocks that could do particularly well: