Are You Ready For $150 Oil? Here's How To Invest Now

Are You Ready For $150 Oil?
Here's How To Invest Now
By Nathan Slaughter, Scarcity & Real Wealth
May 1, 2013
In case you couldn't tell from the gasoline prices in your area,
oil prices have been on the move. The chart below pretty much
says it all.
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Stocks In America
Carla Pasternak, High-Yield Investing
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The 5 Most Shorted Stocks In
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Ben Gersten, Money Morning
As you can see, benchmark West Texas Intermediate Crude has
been bubbling higher lately, and prices have now ascended into
near triple-digit territory. For the record, that's an impressive
120% bounce off the lows from January 2009.
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There are compelling reasons to believe these elevated prices
might stick around for a while. In fact, further upside to $150 is
a distinct possibility. That could act as an economic drag,
siphoning money from consumers and sparking inflationary price
hikes for goods and services.
Right now, the most shorted
stocks include a struggling
retailer, a for-profit college, an
alternative energy company, and
one stock that's up 131% in the
last five months. But don't be
misled into going against the
grain... these stocks are not
"buys."
How To Profit From 'The Death
Of Cash'
Andy Obermueller, Game-Changing
Stocks
I've been telling readers about
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One analyst is predicting a
stock rise of 1,566%.
Another stock has already jumped
over 1,000% and is expected to
keep going.
To learn more about what's
causing these stocks to rocket
higher, click here.
The United States alone consumes 18.9 million barrels of oil
every day, rain or shine. And China's appetite grows more
ravenous by the minute, with daily consumption doubling from
5.5 million barrels in 2003 to nearly 9.8 million in 2011.
Aside from a brief downturn during the recession, global oil
consumption is moving inexorably higher.
Wish You Could Invest Like
John Paulson? Here's Your
And $150 per barrel oil would be a gale-force tailwind for energy
investors.
As you can see,
worldwide oil consumption
passed its pre-recession
2007 peak in 2010 and
continues to rise. It is
projected to reach 90.2
million barrels per day this
year. Meanwhile, the
world's oil companies will
only produce 90 million
barrels per day.
In other words, demand
will outstrip supply by
200,000 barrels per day,
or about 73 million barrels
for the year.
We can barely feed our appetite today. And we're getting
hungrier. Per-capita consumption in China and India is still less
than one-tenth that of the United States. But they're catching
up fast. In fact, 18 million new cars hit the road in China last
year, compared with 14.5 million in the United States. That's
stretching supplies even thinner.
Meanwhile, most production grounds have been in a steady
decline for decades. Future oil exploration activity will be
focused in deep offshore basins, which are expensive to tap
(meaning drilling and production will halt if prices retreat and
recovery becomes uneconomical).
And if all that weren't enough, the Federal Reserve's
quantitative easing and other dollar debasement policies have
given a huge boost to oil and other dollar-denominated assets.
In short, there are plenty of factors underpinning high crude
prices. And I think they are headed even higher.
But even if oil stabilizes at this level, we could still see blowout
profits for many companies -- enough to buy back shares,
raise dividends, and plow surplus cash into expansion
projects to support future growth.
There will be many beneficiaries: offshore drillers, equipment
and service providers, even the alternative energy sector
(which always attracts interest when high oil prices become
oppressive).
But most of the wealth will go to the companies pulling the stuff
out of the ground. Still, you can't just invest blindly.
Some companies may have already locked in most of their
production at lower prices through hedging. Those companies
won't feel the full impact of the tailwind. And integrated giants
like Exxon Mobil (NYSE: XOM) won't yield the greatest returns
either, because high oil prices typically crimp refining profits.
Instead, look for smaller companies with no distractions and a
nimble earnings needle. Small energy producers are by far
the easiest way to make money on energy stocks. If oil
eventually shoots to $150, as I think it will, you'll be glad you
did.
Chance
The hedge-fund manager who
bagged a $15 billion profit has
made his next big bet. Here's why
the time may be right to follow his
lead... Read more
The Most Dangerous Man In The
World
This Nobel Prize winning economist
"won" the vicious argument
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increase government spending,
and those who want to cut
spending and reduce deficits. But
could this man just be setting us
up for catastrophic failure? Read
more
The Next Country To Collapse
Isn't In Europe
A collapse in this country's
currency and the stock market is
all but certain -- the only
question is when. Read more
Is Now The Time To Target
Smith & Wesson?
With gun sales going through the
roof, let's take a look at whether
this company should be part of
your portfolio. Read more
A 20% Rally For This Energy
Company Is Just The Beginning
What separates this energy
company from the field is that it
produces electricity from both
natural gas and nuclear power.
That's a fairly potent combination,
and it should result in better
margins and higher profits. Read
more
Nathan Slaughter
Scarcity & Real Wealth
P.S. -- I've uncovered three investments that are spearheading
"The New Oil Boom of 2013." Even better, these companies
are just a small part of the overall boom taking over the market
today. But it's not too late to get in on this opportunity. Click
here to get all the details.
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