Oil

Article Index

Don't Miss This "Triple Play" Opportunity to Profit from Oil's Rebound

By , America's No. 1 Pattern Trader, Money Morning • @powerproftrades -

A lot of the novel coronavirus speculation has focused on what this outbreak panic will do to stocks. That's why we've covered the best actions to take now, like finding profits in rising pharma shares and getting into strong tech companies at great "buy-in" prices.

Of course, we'll continue to uncover profit opportunities in these areas. But more importantly, a huge cash cow has been revealed somewhere else...

Oil is down 24% in price in just the last month. But demand isn't going away. In fact, it'll increase this year. It is still the world's most important commodity, after all.

When you know how to seize this opportunity, the money can be yours for the taking.

I'm going to show you exactly how to do that today, with the three best ways you can play oil's rebound...

Turmoil in Middle East Makes This Reality Gap Trade in Oil Even Better

By , Technical Trading Specialist, Money Morning • @DRBarton_Stocks -

The reality gap I'd like to explore today is one which the U.S. oil market already had the set-up to be a huge money maker. And then it got better.

The U.S. airstrike which killed top Iranian general, Qassim Suleimani, sent oil prices spiking higher in the Thursday to Friday overnight market, greatly improving our entry for this reality gap trade. I'll explain this profit-making opportunity in more detail, but here's a quick take on this morning's market-moving news and what we can expect.

The financial markets are experiencing significant turmoil after the airstrike that I mentioned above. Defensive investments, or places where money flows in a flight to safety, have jumped higher. These include the Japanese Yen, the Swiss Franc, gold, and U.S. and German bonds.

That's a typical response when uncertainty hits the market - and a military strike like this definitely qualifies. But by the time I started writing this update to the column at 7:00 a.m. EST on Friday morning, the market reaction was already changing.

The market's fear gauge - the CBOE Volatility Index ($VIX) - which had spiked higher on the news, was already falling, as were Oil prices. And the major market indexes like the S&P 500 had already found their lows of the morning.

In short, the market's reaction to the airstrike is acting as a test of how much geopolitical risk matters in the markets right now. Said another way, there's a very good chance that the market just absorbs this news as a temporary blip. And that will be very good news for today's trade in a struggling U.S. shale oil producer...

The U.S. shale oil industry has revolutionized the crude oil market. And it was a major - if somewhat behind the scenes - driver of the recovery in the U.S. economy since 2009. Take a look at this production chart:

The impact of this shale oil boom on global oil economics has been immense.

But like the retail resurgence of 2019, the story of U.S. shale oil emergence is littered with haves and have nots. And as we'll see, right now it's easier to make money on one of the players that has struggled - and will continue to do so.

There's a reality gap in the shale oil world. The widely held belief is that the rising tide of crude oil production that we see in the chart above is lifting all ships. The reality is that some companies could be in big trouble because of the way they have raised money to finance their wells. And we can make money with that information that almost no one is telling you about it.

Some in the financial news media are even saying that U.S. oil companies are the best stocks to buy for 2020.

That prognostication is just people talking their book (touting the stocks they own in an effort to drive up the price) and it's dangerous to your wealth.

Now, I'm not saying that the shale industry is going under. Far from it. The "haves" will thrive, much as they did in the retail industry.

The reality gap is happening between what you're being told about U.S. fracking, and what's really happening on the ground...

More and more, small companies are about to go under. And you can make money while they do.

Here's what's happening...

The Top MLP of the Week Will Pay You a Nearly 7% Yield

By , Money Morning -

If you're a long-time Money Morning reader, you know it's no secret that we're big fans of MLPs.

That's why we're always on the lookout for the top MLPs to buy. MLPs are known for their excellent dividend payouts, reliability, and consistent distributions for income-seeking investors.

So, today, we've uncovered one MLP that not only pays 7%, but it also has great growth potential.

In fact, it could soar 110% over the next 12 months...

This Top MLP to Buy Pays a 6.8% Dividend Yield and Could Grow 117%

By , Associate Editor, Money Morning -

If you've been following us at Money Morning, you know it's no secret that we're huge

fans of MLPs. That's precisely why we're always looking for the top MLPs to buy. MLPs

are known for their excellent dividend payouts for income-seeking investors. So, today,

we've found one MLP that not only pays a great dividend yield of 6.8%, but it also has

some serious growth potential. In fact, it could explode 117% over the next 12 months...

Read more here...

How the Saudi Oil Attacks Will Impact Crude Prices

By , Director of Research, Money Morning -

Investors on Monday digested news of the massive drone attacks on Saudi Arabian oil infrastructure at Abqaiq and Khurais. Stocks took it pretty well, it has to be said; the Dow slid around 0.27% as an "oil shock" that would've sent indexes tumbling hundreds of points 10 or 20 years ago rippled through the broader markets.

Oil, on the other hand, is seeing virtually unprecedented volatility. Prices for crude have jumped by as much as $10 a barrel following the disruption of around half of Saudi Arabia's daily output. Prices then lurched lower yesterday when Saudi Energy Minister Prince Abdulaziz bin Salman suggested oil supply will be back online by the end of September.

As we'll see in a second, the ground reality is probably more complicated than that, and traders are still deeply conflicted about the big picture.

And in the chaos and conflict roiling the oil markets right now lies a once-in-a-generation opportunity for investors...

What Every Investor Needs to Know About the Saudi Arabian Oil Attacks

By , Global Energy Strategist, Oil & Energy Investor • @KentMoors_OEI -

I was still in the air with my wife, traveling between Dubai and our home in Florida, when some of the world's most important oil production and processing facilities in Saudi Arabia were attacked by drones.

By the time we landed, the massive Saudi Aramco processing facility at Abqaiq and the Khurais oil fields were burning, around 7% of global daily crude production was falling offline, and global crude prices were spiking by double digits.

At home, before I even had a chance to unpack, I participated in a marathon series of overseas conference calls which have only just ended.

With the attack, claimed by Houthi rebels out of Yemen, the long-simmering Saudi-Iranian proxy war has reached a new, volatile boil.

Frankly, White House rhetoric notwithstanding, Saudi Arabia's next steps will largely determine when and where outright war breaks out.

I can say with certainty, however, that U.S. and Saudi government responses to the global oil market have missed the mark.

Here's what's really happening...

As Oil Prices Fall, Here's What You Need to Do Now

By , Executive Producer, Money Morning -

Only a day after markets cheered the U.S.-China trade truce, U.S. President Donald Trump threatened to slap $4 billion in tariffs on goods flowing out of the EU, causing oil prices to plunge this past Tuesday.

Since you can’t really trust the chatter about oil prices heading higher in the third quarter, Garrett’s going to show you how to make money on this trend…

Read more...

Oil Prices Should Be Going Up - Here's Why They're Not

By , Global Energy Strategist, Oil & Energy Investor • @KentMoors_OEI -

As I write this, oil prices are retreating (again) and approaching two-month lows. This decline is underway despite some rather heavy supply pressures that should be moving it up.

Thus, the question is: Why?

The overall dynamics would seem to indicate higher prices:

Things like the reimposition of U.S. sanctions against Iran; a continuing collapse in Venezuela; widening impact from a festering civil war in Libya; a Russian export suspension mess on the world's largest pipeline remaining unresolved; an OPEC+ emphasis on production restraint; extraction problems in Mexico; and even discount pricing spreads in Canada have moved supply concerns to the front burner.

And that's just the warm-up.

Now, all this needs to be put in perspective...

What You Need to Know About the Oil Price Comeback

By , Global Energy Strategist, Oil & Energy Investor • @KentMoors_OEI -

The price of crude oil is renewing an upward march.

I've said it before, and I'll say it again. It's quite the breath of fresh air after the collapse we experienced at the end of last year.

As of trading close yesterday (2:30 PM for oil in New York), West Texas Intermediate (WTI), the benchmark crude rate written in New York, was up another 1.6% for the day, 5.3% for the week, and 10.6% for the month.

Year to date (YTD), WTI is up a hefty 37.8%.

Meanwhile, Brent, the more widely used global benchmark set daily in London, is better by .5%, 2,4%, and 5.4%, respectively, with a YTD gain of 28.9%.

Of interest now is the Brent-WTI spread, the difference between the two benchmark figures...

Here's My Full 2019 Crude Oil Price Forecast (and the Best Way to Profit)

By , Global Energy Strategist, Oil & Energy Investor • @KentMoors_OEI -

The final quarter of 2018 has certainly been "historic." Then again, so was RMS Titanic's last night above water.

Both primary crude benchmarks posted highs on Oct. 3, but through close of trade on Dec. 27, they've been in marked retreat. West Texas Intermediate (WTI), the standard for futures contracts set in New York, has lost 41.6%, while Brent, the more widely used global yardstick set daily in London, has shed 39.8%.

Those figures even include a major single-session advance of 8% recorded on Dec. 26.

Of course, oil has been moving in tandem with a collapsing broader stock market. Weakness and volatility have been boosted by (largely misplaced) angst involving a credit inversion, where shorter-term maturities begin offering higher yields than paper further down on the curve.

A yield inversion is sometimes regarded as a precursor to a recession, although I also regard this fear as quite overblown.

Why? It's simple: The market has had more inversions not leading to recessions than it has had those resulting in one. Besides, in the unlikely event a recession hits this time around, it usually takes at least 18 months for any tangible indicators to form. Prior to that, it's all idle speculation, guesswork, and worry.

And as if to put a point on it, that worrisome inversion has quietly corrected over the past few weeks.

At the end of each year, there is a combination of loss-taking for tax purposes, institutional investors balancing and re-balancing portfolios, and lowered liquidity.

This is nothing new. This year, however, all three factors have collided in a profoundly uncertain environment fueled by a government shutdown, geopolitical tensions, concerns over U.S. foreign policy consistency, a U.S.-Chinese trade war, and highly suspicious computer-buying programs.

So it's easy to see why crude prices seem stuck in the basement - stock prices, too, for that matter.

But as I'm about to show you, the year ahead looks much brighter than the current situation suggests...