Consider the following…

Oil is one of the most important natural resources known to mankind. For most societies in the world, oil is the principal natural resource that fuels their economies. Then why, in this great age of communication and technology, do we need to be concerned about a natural resource like oil? Simple. Nearly 98% of everything you have or do is in some way related to crude oil. Heat for your home, gas for your car, 2 liter plastic bottles for pop, and petroleum jelly are just a few examples of products created from crude oil. The United States has the greatest standard of living in the world, as well as the largest economy. Why? Because we have always tried to maintain control over the supply, as well as price, of oil. Over the last 10 years, the U.S. economy has undergone the largest economic expansion in history and cheap oil has fueled this unprecedented growth. Unlike the 1970s, when the U.S. was held at bay by OPEC withholding oil production for political reasons, the growth of the oil industry during the 1990s, and beyond, will be more likely be determined by the laws of supply and demand. As democracy and capitalism are spreading around the world, global oil consumption is at record levels. Throughout Latin America, Russia, India and Asia, economic growth is accelerating at a remarkable pace; much faster than anything we have seen in the U.S. Recently, Forbes described the development now exploding across Asia. --Forbes

As any astute investor knows, it is extremely difficult during these times to find financial opportunities which provide both security and a solid return on your hard-earned money, Conventional investment in CD’s, savings accounts, money markets, mutual funds, stocks and bonds, etc. are currently bringing less than satisfactory returns. The Wall Street Journal, Forbes, Fortune and other well know financial publications have shown the recent volatility in the financial markets. T he future prospect for profits are even worse when inflation is calculated. Now is the time to diversify your portfolio in hard dollar investments in oil and gas drilling programs. The key to better return is to diversify your portfolio in energy related investments. Take advantage of opportunities which have excellent risk-to-reward ratios while still maintaining you personal and or family financial foundation. Prudent investment in sound, well researched oil and gas programs, can offer a significant monthly cash flow from the sale of oil and gas well production and very significant tax advantages not found with normal investments. With the additional benefits of higher prices, these benefits far exceed gains and tax advantages on energy related stocks.

Oil Clock


Find out how to invest in energy stocks at EnergyAndCapital.com.

Monday, June 1, 2009

Oil Rises Toward $68 on Higher Stocks, Lower Dollar


By: Reuters | 01 Jun 2009 | 09:21 AM ET
Oil rose more than 2 percent to a seven-month high on Monday, extending its biggest monthly gain in a decade due to rallying stock markets and sustained expectations for a global economic recovery.
U.S. stocks rose, following gains in Europe and Asia driven by data showing China's manufacturing continued to expand moderately in May. The dollar weakened, boosting investor demand for oil and commodities.

The dollar weakened, boosting investor demand for oil and commodities.

"It's the dollar and equities," said Christopher Bellew, a broker at Bache Commodities. "It's maybe not so surprising if there is a chance of seeing some economic recovery and increased demand for oil."

U.S. light sweet crude [US@CL.1 67.79 1.48 (+2.23%)] was higher, having climbed as high as $68.29.

London Brent crude [GB@IB.1 67.1 1.58 (+2.41%)] rose.

The market is still down sharply from a record high over $147 reached last year.

China's manufacturing sector continued to expand moderately in May as new export orders improved, two surveys showed on Monday, adding to tentative signs the world's third-largest economy was stabilizing.

Oil rallied by 30 percent in May to its highest since early last November, giving OPEC enough hope about the outlook that it agreed to maintain production at last week's meeting.

Inventories

At the same time, OPEC is unlikely to move quickly to curtail the rally.

At the weekend Saudi Oil Minister Ali al-Naimi said OPEC would wait until crude inventories fall to around 53 days of forward cover before considering raising output, nearly 10 days below current levels.

Despite oil's rally, many analysts have said the underlying fundamentals remain bearish.

This is now starting to change, with U.S. crude stockpiles falling last week and gasoline inventories dropping for the fifth week.

Reflecting increased expectations that prices will rise, speculators have expanded their net length in NYMEX crude contracts to over 40,000 lots, the highest since February.

Oil as well as base metals investors are now factoring in economic revival and "probably a fairly decent 'V'," said Commonwealth Bank of Australia commodity strategist David Moore.

"There is a risk that if economic data does not continue to support this view of the world that markets become disappointed with the pace of economic recovery, leading to price setbacks," he said.

Also, there is a risk of tempered demand growth as higher prices are passed on in some of the world's fastest-growing oil markets.

Beijing from Monday raised retail diesel and gasoline prices by 6-7 percent, the second and biggest rise this year.
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