Paul Killinger

Crude Oil ETFs: Double Down, or Double Up

Well done, sir. Get your bets down...!

My personal favorite "oil game" is watching the U.S. Senate. A couple of weeks ago, the domestic pro-drillers got 42 votes (...out of 60 necessary) to explore for more offshore oil and gas. While it is possible they could make up the difference in this November's elections, since only a third of the Senate runs every two years (...and only 12 are Democrats this time), this is highly unlikely.

The House is a different story. All 435 members face re-election every two years, so they are more attuned to the will of the electorate. And they only require a simple majority vote to explore for more domestic energy reserves, as well, which I suspect they have already. Due to the power vested in the Speaker, however, they have managed to dodge a vote on this issue so far, but the time is coming.

Nevertheless, owing to the intransigence of several Senators, it is unlikely the Congress will end our self-imposed boycott on increasing our domestic energy supplies in the near future. Despite attempts now underway to "bundle" bills that may achieve this end by putting more renewables and traditional energy sources together, the anti-explorers are very likely to hold fast at least until they see the outcome of this year's presidential election.

Finally, you probably heard about how trading slowed on the NYSE on the recent Monday that Tiger Woods was on TV winning his 19-hole playoff victory in the U.S. Open. Well, those same people watch the Senate's proceedings live every day. Therefore, it is my "bet" that oil prices won't recede until we see some dramatic movement there on the issue of American energy independence.