[dinopello]

I noticed that too. Bummer. Also, the oil majors have less to pump. I'm holding right now. Also picked up some BNI at 79. The only stock doing well is my Smith & Wesson (SWHC).

[MrBill]

If you did not sell two weeks ago then now is time to ride it out. I would look at the S&P Energy Index again once it gets back down to around 500. It will be hard for energy stocks to buck the down trend in stock markets, especially as they were the biggest gainers on the way up this year. Still, the IEA is forecasting global crude demand to be 86 mbpd next year, so even a steep slow down in the USA is not going to dent world wide demand severely. It is just that you may see better entry levels than now going forward. Cash is King at the moment. Let the market settle wherever it chooses.

[mkwin]

I would consider selling and reinvesting in a month or two.

The hour-by-hour picture in the credit markets is getting worse as we speak. The European Central Bank has just injected $120b into the system to try to settle things. One bond trader is quoted as saying the financial system is in chaos. It seems a significant credit crunch is coming.

Oil stocks will continue to fall as expectations of a recession grow. If you believe in the thesis of a near-term peak and decline, this could represent a good buying opportunity at some point. The question is when.

[eastbay]

To expand further on MrBill's comments, demand worldwide is still growing steadily and even a worldwide recession isn't going to prevent the gap between demand and production from widening. 86 mpp/d is unlikely. Even in the unlikely event of a worldwide decline in demand, oil prices will remain high because production appears to be on an undulating plateau and will soon be dropping exerting upward force on prices.

I too suggest keeping your energy positions. Volatility is the norm in this racket.

[Mechler]

I'm with MrBill on this one. Everyone is selling now, which means the long term investor should be looking at buying or adding to his positions. Trading contrary to the market is extremely difficult, but it's how most of the major players make their money.

Are we headed into recession? Are we already in a recession? Who knows - but the energy sector shouldn't be affected except for the "fear" selling that is going on now. You think Exxon or Schlumberger will lose money if we (the US, not the rest of the quickly growing world) enter into a recession? People still have to drive to work (and now they probably have to drive farther because they can't afford the house that's close to work ) and oil still has to be found.

If anything, I think what's going on in our economy is going to be a perfect excuse for OPEC not to increase production. That could lead to a wild energy market later.

Maybe I'm being too optimistic, but I don't think this will be economic armageddon, especially for energy.

[Twilight]

Energy stocks are taking a beating, but not the worst beating. Everything could go down, but some stuff by a lot less. My best peak-aware energy investment is actually being in there. A lot of people employed in the service economy are going to get their monthly dividend cut, if you catch my drift.

[MrBill]

Just quickly, as per Trader's Corner this morning. Anyone have any favorite mining stocks that they like? Why? Thanks.

[Blacksmith]

Gee my energy stock just hit an all time high, its just you don't know what to invest in PBG-T.

[MD]

I'll maintain my energy stocks indefinitely. Screw the short term. If it all goes to hell that bad, it just won't matter.

[MrBill]

How long have you owned it? What has the rest of your portfolio done? What is your long-term ROI?

$this->bbcode_second_pass_quote('Blacksmith', 'G')ee my energy stock just hit an all time high, its just you don't know what to invest in PBG-T.

[Ming]

I agree that this is a moment to hold to energy investments.

I am short in DSL (loan banking) XHB (a builders index follower) and so on.
For me, that has more then compensated the fall in SU, COP, etc..

So, it will not be NOW (after this mostly expected correction) that I will close my long term positions in (good) energy stocks…

[rockdoc123]

$this->bbcode_second_pass_quote('', 'A')t a P/E of 94 and an estimated P/E of 45-46 while paying 0% dividend it looks like an underpriced stock that has enjoyed a nice ride this year. What about next?

[MrBill]

$this->bbcode_second_pass_quote('rockdoc123', '')$this->bbcode_second_pass_quote('', 'A')t a P/E of 94 and an estimated P/E of 45-46 while paying 0% dividend it looks like an underpriced stock that has enjoyed a nice ride this year. What about next?

[Eli]

If this hurricane gets rolling into the Gulf it may present an excellent time to sell and reposition at a lower price.

I am betting we are going to see a major correction once all the financials and mortgage companies start reporting in Q3. People have not be able to get as many HELC out of their house and they are switching to credit cards because of that fact. There are already lots of signs that the consumer is crapping out.

I think we still live in a world where people think that a recession means a decline in oil demand. If the market corrects everything is coming down along with it. It is going to take a little while for people to see that the rules have changed for oil.

[evilgenius]

Fave mining huh, CDE, because it is undervalued along w/ silver - and it is a biggie. That being said I think it has room to go down, 20% maybe. Northgate is a good gold miner, buy it below $3 or you will regret having to hang in so long.

Stay away from the big producers. They are in dangerous places that won't be friendly soon.

[JBinKC]

The reason why Petrobank trades so high is it is a potential lowest cost producer in the heavy oil/bitumen space. If this holds true it wouldn't take much for them to become the biggest player using a high stock price and boatloads of heavy oil juniors out there holding vast reserves but lack the capital to go forward with SAGD.


I have owned this stock since 2003 and definitely see no reason to sell.

The other stock I would watch closely and definitely buy on weakness is Heritage Oil and if you want less volatility its partner Tullow Oil. There has been some recent unrest in the region but the company is adding reserves at a lightning pace in Uganda.

[rockdoc123]

$this->bbcode_second_pass_quote('', 'T')he other stock I would watch closely and definitely buy on weakness is Heritage Oil and if you want less volatility its partner Tullow Oil. There has been some recent unrest in the region but the company is adding reserves at a lightning pace in Uganda.

[JBinKC]

My caution on Heritage is that the drilling results seem to be mixed, latest well is gas and not oil. Given where they are situated I suspect you would need a minimum of around 400 MMB to be economic (need to build a long pipeline). It might all come together for them but still a lot of risk.[/quote]


Mixed? what are you smoking? Over the last year Tullow is 7 for 7 (6 oil one gas) and Heritage is 1 for 1 all oil


Have you seen Heritage's presentation?

They have risked reserves at 1 billion barrels net to them. In blocks 1 and 3A .

Heritage's Block 3A has been 100% successful so far. The P50 number is at 500 million of total recoverable barrels on the upper structures of the Kingfisher prospect. They will be drilling the deeper structure in Q4 of this year which is about the same size.

Tullow's 100% latest published well Nzizi -2 did hit gas which I find to be a good news to justify the size of the structures in the area are likely sealed and accurate!!!

Tullow in their latest well which they did not publish the results. (I saw the information from an Ugandan source) Mputa- 3 an appraisal well also had hit oil and it looks likely that field will have 200 MMB of recoverable barrels.


The Pelican and Ngassa structures are also very large
with the P50 recoverable reserves in the 400-500 million range.


And this excludes the other 27 potential oil bearing structures in the blocks of which there are 3 large ones in Block 1 and we even haven talked about the other concessions on the DRC side.

[rockdoc123]

$this->bbcode_second_pass_quote('', 'H')ave you seen Heritage's presentation?

They have risked reserves at 1 billion barrels net to them. In blocks 1 and 3A .

Heritage's Block 3A has been 100% successful so far. The P50 number is at 500 million of total recoverable barrels on the upper structures of the Kingfisher prospect. They will be drilling the deeper structure in Q4 of this year which is about the same size.

Tullow's 100% latest published well Nzizi -2 did hit gas which I find to be a good news to justify the size of the structures in the area are likely sealed and accurate!!!

Tullow in their latest well which they did not publish the results. (I saw the information from an Ugandan source) Mputa- 3 an appraisal well also had hit oil and it looks likely that field will have 200 MMB of recoverable barrels.


The Pelican and Ngassa structures are also very large
with the P50 recoverable reserves in the 400-500 million range.


And this excludes the other 27 potential oil bearing structures in the blocks of which there are 3 large ones in Block 1 and we even haven talked about the other concessions on the DRC side.

[seahorse]

Rockdoc, everything you said in your last post I understand and it makes sense to me. However, why doesn't the same apply to the old, ongoing concerns that SA and several other Opec countries are doing the same thing, making grand press releases which are less than truthful? I don't want to re-ignite the old SA thread, but, out of curiosity, why are the motives of Opec any different than the motives of some of these smaller oil/gas companies etc? Again, I will not argue this point on this thread, but I would like to hear how you see differences where I see similarities.