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, August 3, 2009

Oil Rises Above $71 on US, China Factory Output


By: Reuters | 03 Aug 2009 | 12:06 PM ET
Oil rose more than $1 after hitting a one-month high near $72 Monday as positive manufacturing data in the U.S. and China raised optimism for an economic recovery that could bolster energy demand.

U.S. light, sweet crude [US@CL.1 71.45 2.00 (+2.88%)] rose more than $1 to above $71 a barrel after earlier hitting $71.95, the highest since June 30. London Brent crude [GB@IB.1 73.67 1.97 (+2.75%)] also rose.

The U.S. manufacturing sector continued to shrink in July, but at a slower pace than in June and at a lesser rate than expected, according to figures released by the Institute for Supply management on Monday.

The July index of national factory activity rose to 48.9 from 44.8 in June, the highest reading since August 2008.

In China, a surge in domestic investment spurred factory activity, with Brokerage CLSA's China Purchasing Managers' Index (PMI) rising to a one-year high of 52.8 in July from 51.8 in June.

"The weak dollar and the manufacturing data are big boosts to the energy markets today"' said Phil Flynn, analyst at PFGBest Research, Chicago.

Oil Barrels

Analysts said a weak dollar, which slid to its lowest point this year on Monday against a basket of currencies amid increased risk appetite, would offer support to oil. Global shares were boosted by the news, with Wall Street opening higher and the S&P 500 Index advancing briefly above the 1,000 level to its highest level in 9 months.

European shares hit a new high for 2009, led by banks. The latest gain in oil prices brings oil within sight of the 2009 high of $73.38 set in June, though some see resistance that prices could struggle to rally beyond.

"I feel that the market has gathered so much momentum and crude may be overpriced at this point," Flynn said. On Friday, crude rallied almost 4 percent as data showed the U.S. economy shrank at a smaller-than-expected 1 percent annualized pace in the second quarter, raising hopes the recession was easing.

The market climbed about 2 percent last week — the third straight week of gains — which helped to reverse steep losses in the middle of the month and brought July's monthly decline to a marginal 0.6 percent.

China's crude stockpiles in June, including both state strategic and commercial reserves, declined 2.7 percent from a month earlier, the first fall in four months, China OGP, a newsletter run by Xinhua, reported.

Supply curbs by the Organization of the Petroleum Exporting Countries since last year in response to falling demand have helped crude rally from below $33 in December.

However, output from 11 members from the OPEC rose slightly in July, lowering its compliance rate to its agreed supply curb to 71 percent from 72 percent in June, a Reuters survey showed.
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