AlexR

Your Oil Stocks Aren't Coming Back

The key fact the bullish 'peak oil' theorists seem to miss is that without oil, the companies that produce oil will die. If you believe in peak oil, you should be bearish on oil companies. Just look at any other technology that has peaked. Only very rarely will a leader of a dead technology be able to adapt and survive.

On Feb 20 08:29 AM longoil wrote:

> Comparing oil services stocks and internet stocks is like comparing
> apples and oranges. The world can live without eBay or Amazon, but
> cannot live without oil and gas.
>
> Conventional oil production has peaked. This is why major oil companies
> are investing heavily in non-conventional projects like the oil sands,
> deep sea drilling and tight gas extraction. The current economic
> malaise has hidden the fact that peak oil is happening. The services
> companies RIG, DO, and NOV as well as producers CHK and COP are excellent
> long term plays when the economy (and oil demand) recovers.
>
> Alternative energy sources (solar, wind, hydro) currently makes up
> less than 5% of the world's energy mix. It will take at least 50
> years to get off of oil and gas. Oil and gas is king till the middle
> of this century.

Investment Ideas for an Inflationary Environment

I don't buy this "knife edge" analogy. For the longest time, Fed maneuvers have more closely resembled skateboarding on the half-pipe. Economic policy will always overshoot and then revert. As soon as the Fed smells inflation, rates will start going up again, and liquidity removed from the markets, guaranteed.