Huge oil profits go for exploration

With oil trading near $60 a barrel, U.S. energy companies are reporting huge profits this week and heralding global searches for new supplies after years of investing in stock buybacks rather than oil stocks.

But renewed exploration is tied to remote and risky areas of the world amid greater competition for those potential resources, energy analysts say. The upshot: High prices are probably here to stay for a while.

Energy traders on the New York Mercantile Exchange have bid oil futures above $61 a barrel through most of next year. Futures quotes do not dip below Wednesday’s $59.11 a barrel for September delivery until June 2008, by which time new supplies in Africa and the Gulf of Mexico are expected to be available.
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