I think that the current drop in oil prices is a big overreaction. ______________________________we like fifa 15 coins without reason Go to our home page w ww.fifautc.co.uk/
Well, the Fed has been hinting about raising rates before too much longer either way. This could spell trouble for those highly leveraged companies, their lenders, investors, and also for the US as a whole with $18 trillion in debt ourselves.
My opinion is that there is another big downturn in the price of oil. This is a political thing, you need to wait until Russia cracks or hints at cracking. The low point of oil isn´t going to be until Russia loses their little gambit. I think we have at least a few more months of low oil prices. You can definitely buy now and make money over hte next 2 years.. but I don´t think we are at the bottom yet.
I think you're right to assume the long-term approach. When we get the quarterly results we'll have the oil companies providing disappointing outlooks and revising down their expectations, which in turn tends to be a cue for more of a sell off in the stocks. If you're in it for the long term then it definitely makes sense, assuming of course that we're not in a long-term oil price era. But the last time that happened, we saw a raft of M&A in the industry, so that was also a positive for the sector long term.
And before we get caught up in predictions on the oil price, here's the front cover of the Economist back in 1999 when it was talking about oil going down to $5/barrel - i.e. none of us has a clue....
that really is the gamble, who breaks first.. OPEC or Russia. I think Saudi is taking some short-term gain in order for long-term benefit. If they can help break Russia now, it will remove/limit a long term rival. Saudi has a ton of money and they can just sit on it until this passes. Russia and Venezuala have political and social obligations with their oil revenues. The more dysfunctional the oil industry in Russia becomes because of this, the more Saudi benefits. This also helps Saudi because of exploration. With low oil prices, other companies/companies will not be investing in exploration as much. Saudi doesn´t need to explore, they just need to pump. Anything that prevents exploration by rivals helps saudi.
These guys all make the same mistake in order to write ´sensationalized´ stories. The fact is that the more the price of oil sinks, the less likely companies are to invest in infrastructure or exploration. You cannot take the amount of infrastructure and exploration spending at a time of high oil prices and then not adjust that as prices start to fall. There is a buffer system in places. The same thing goes for cars.. when oil prices are low, more people buy bigger cars.
Rumors have it that oil prices will keep creeping down further. http://rt.com/business/217007-20-dollar-oil-opec/ For short-term investors this definitely isn't the right time to buy oil company stocks. For those who desire to make a killing after all prices start going up, this certainly is the right time to buy oil stocks.
