It’s a known fact that while world oil reserves are decreasing; the demand for world oil is increasing. Perhaps the present and the future generations will never see $25.00 oil again. The current price of oil can certainly confirm this statement in the global oil market
Logically, stocks in oil market should be a good long term investment. Unlike forex trading which is less predictable but can result in higher profit. Oil stocks bottom line and valuation can be affected by the location of the oil companies and the reserves. Let us take a closer look at the trends in oil market.
The main anchors in the oil market are the demand and supply levels along with the supply cost curve. With the crude oil prices reached $90 and higher, high development costs have further raised the oil price. This has led to new upstream projects to be sanctioned and developed.
Economists feel that there is plenty of fuel to feed the bullish oil market trends in the months and years to come. But one has seen a wide range in the oil prices, fluctuating from $50 to $99. As the economy picks up, spare capacity will start to erode with the oil market tightening up again in the first half of the decade. Oil traders predict that once the global economy recovers, supplies will tighten up quickly as compared to the demand. Although, the fundamental picture of the oil market may be somewhat relaxed during the next few years.
Today, a skilled manager makes more than the owner. And owners fight each other to get the skilled managers.
— Mikhail Khodorkovsky.