basehitz

How to Invest in Peak Oil

I agree with your balance between long term fundamentals and short term speculation. Da Boyz do like to trade energy. Holding the current $60 has been repeatedly cited this weekend as key to the next short term move. As I see it, earnings this week should provide the catalyst to drive both stocks and oil. I don't think crappy results that are "better than expected" will suffice if revenue and/or guidance shows green shoots are really just yellow weeds.

As an investment strategy, I agree with swing trading here. I'm going into the week light expecting opportunity, but preferring to err on the side of caution. I prefer international oil drillers to integrated, and in particular deepwater drillers. I think few would dispute that future oil will become increasingly more difficult and expensive to obtain. The specs on RIG's newbuilds shows the trend.

NG remains volatile in spite of abundant supply. Recent volume of UNG says Da Boyz found a new play thing. So far, it's not cooperating in spite of a flurry of coincident promotional articles. Of course Da Boyz weren't doing a pump & dump. (cough) Storage is excessive. From EIA's website today "At 2,796 Bcf, working gas stocks are at the second-highest level for any week in July since 1994." It stayed below $2 until well into 1995.
seekingalpha.com/artic...

In spite of idling well over half the NG rigs since last Sept, storage continues to increase. I assume there is a storage capacity limit, which if reached before extraction season would crater NG prices.