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All Things Are Not Equal in the Energy Sector

|Includes: VanEck Vectors Oil Services ETF (OIH), UNG, USL, USO

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David Gillie is a Contributing Editor and subscriber to the ETF Digest.

He has been an Engineering Consultant for multi-million dollar construction claims, President and Founder of Envirospec, Inc. (Robotic Pipeline Inspection Equipment) and owner of David Gillie Woodworking & Design.

He divides his time between Wilmington, North Carolina and Fort Myers, Florida.

 

 

Crude oil is over $100 per barrel and it looks like higher oil prices are here to stay. Some analysts are calling for oil to exceed its 2008 highs of $140/bbl. 

This means everything in the Energy sector goes to the moon, right? Not so fast—bear in mind that higher crude prices mean higher costs of raw materials for refiners. Retailer tightens margins as consumers go into an uproar when the price at the pump is over $4/gallon. Let’s not forget the transportation costs of those tank trucks delivering gasoline to the retailers.

So who profits by higher crude prices? Oil Exploration and Drilling.