Record Oil Prices – See Why Oil Prices Are Rising
Dec 12, 1998. One thing about the oil industry is that it’s very cyclical, prices go up, then
they come down. Is it a growth industry? Yes. Will it be around for many moons to come? I and everyone else thinks
so. Should you buy oil stocks at today’s prices? Maybe yes, maybe no. Here are a few thoughts to ponder:
As of December 1998, oil is at $11 a barrel. In my estimation it should go to about $16 or $18
a barrel by next year. Which in turn, the oil companies like Exxon and their ilk will command a price point of
a 20% increase. Not bad. Is this what you’re looking for in a year or two? You have to be crazy to say no. But,
guess what, how do we know that oil will hit $18 a barrel anyway. More good news for my readers. If you have any
doubts about the growth, just consider what will happen when China and India begin to buy more cars, refrigerators,
and air conditioners. There may not be enough energy to satisfy demand in two markets that will have more than
a billion customers.
All right now, do you buy oil stocks now or wait until it hits a little lower? That’s up to you,
but it does look pretty good to me now, especially when the oil stocks will give their investors a nice 3% dividend.