Investing

is now the time to invest in oil stocks?

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Deal Expert
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Dec 11, 2005
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Depends on what you think the future of oil is. IMO it ain't so rosy. Prices are not going up any time soon, and when they do go back up they will never reach previous highs.
To be nobody but yourself - in a world which is doing its best, night and day, to make you everybody else - means to fight the hardest battle which any human being can fight; and never stop fighting. -- E. E. Cummings
Newbie
Nov 12, 2013
43 posts
10 upvotes
Ontario
Now is not the time to invest in etfs or mutual funds in taxable accounts. Reason being the taxable distributions for year-end, for example XEG has a 7% capital gains distribution due towards the end of December
Penalty Box
Apr 16, 2012
3565 posts
687 upvotes
Greely
Isn't it ironic that just 3 months ago, no way people thought oil would reach this low....now people think no way oil would reach back at previous high levels.
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Feb 19, 2010
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brunes wrote: Depends on what you think the future of oil is. IMO it ain't so rosy. Prices are not going up any time soon, and when they do go back up they will never reach previous highs.
Never? That's quite a bold statement.
Deal Fanatic
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Oct 9, 2008
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Thornhill
I wouldn't be surprised if you see any "terrorist or militant groups" sabotaging pipelines in the near future.
Deal Addict
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Dec 26, 2006
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Jeenyus1 wrote: I wouldn't be surprised if you see any "terrorist or militant groups" sabotaging pipelines in the near future.
In North America, or elsewhere?
Deal Addict
Nov 11, 2004
3295 posts
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Ottawa
brunes wrote: Depends on what you think the future of oil is. IMO it ain't so rosy. Prices are not going up any time soon, and when they do go back up they will never reach previous highs.
Never say Never
Hello
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Oct 9, 2008
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Thornhill
mc_molineux wrote: In North America, or elsewhere?
If it's going to happen (just food for thought) it'll happen in a third-world oil producing country ie: Nigeria or Iran-Iraq.
Deal Addict
Jun 2, 2012
1536 posts
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GTA
Cerenity wrote: My view on investing in commodities is quite simple.

There are only 2 types of commodity related businesses that are investment grade. One is companies that MOVE commodities. This includes pipelines and to a certain extent rails (altho they are technically industrials) like Enbridge, Kinder Morgan, CN, etc. The other is companies that are super diversified, either via vertical integration like Exxon, Suncor, Chevron, or via product type, like BHP.

Everything else is highly speculative. Some people may have a spot in their portfolio for that, but expect to lose your shirt once in a while when the bust cycle inevitably comes around.
Enbridge should be listed as a diversified company.. just like Suncor
Everyone for some reason thinks Enbridge is just a gas transportation/distribution company


Since our initial investment in a wind farm in 2002, we've invested nearly $4 billion in wind, solar, geothermal, power transmission, waste heat recovery, and a host of other alternative energy technology projects that, together, have the capacity to generate more than 1,800 megawatts (MW) of zero-emission energy. Enbridge is one of the largest renewable energy companies in Canada, and our portfolio of renewable energy projects is diversified and growing. So far, we’ve invested in:
12 wind farms (1,662 MW capacity);
Four solar energy operations (150 MW capacity);
A geothermal project (22 MW capacity).

Not including this.. that is happening right now

Canada’s largest pipeline company, said it has agreed to buy an 80 percent stake in two U.S. wind farms from German power utility E.ON SE (OTCMKTS:EONGY).

The enterprise value for the portfolio is about $650 million, Calgary, Alberta-based Enbridge said in a statement today.

E.ON which will retain a 20 percent stake and remain as operator.

The two wind parks--Magic Valley 1 in Texas and Wildcat 1 in Indiana--provide enough power for more than 120,000 households.

Upon closing, the acquisition of these two wind farms will bring Enbridge's total net generating capacity of green power projects to more than 1,600 megawatts and helps position the company to double existing capacity by 2018, Enbridge said.
theredstar wrote: I recommend everyone sell your oil stocks. with oil prices this low, companies like COS, canadian natural resources, suncor, etc... can't make a profit and will soon go bankrupt.
Companies like Suncor, can still make money if oil hit's $30
They also have other sources of income...
Deal Expert
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Dec 11, 2005
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ilusa wrote: Never say Never
I can say never if I want.. :P

I do not believe oil will ever again reach $140 a barrel. The worlds energy mix is very rapidly changing and oil will have an ever-shrinking role in it. If oil ever reaches $140 again, feel free to come back into this thread and berate me, but I don't think it will. The only thing that could cause it to get there would be a dramatic rise in ISIS tensions.
To be nobody but yourself - in a world which is doing its best, night and day, to make you everybody else - means to fight the hardest battle which any human being can fight; and never stop fighting. -- E. E. Cummings
Penalty Box
Apr 16, 2012
3565 posts
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Greely
brunes wrote: I can say never if I want.. :P

I do not believe oil will ever again reach $140 a barrel. The worlds energy mix is very rapidly changing and oil will have an ever-shrinking role in it. If oil ever reaches $140 again, feel free to come back into this thread and berate me, but I don't think it will. The only thing that could cause it to get there would be a dramatic rise in ISIS tensions.
I just find it very interesting that you conveniently say this right after oil prices has already crashed and I've never heard of such posts before all this.
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Oct 9, 2008
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Thornhill
If you're still hell-bent on investing in oil I'd advise to wait until end of fiscal year or right before the end because a lot of people will be selling for capital losses.
Deal Addict
Sep 6, 2010
1944 posts
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Vancouver
Diversification is and always will be paramount, yet another lesson learned by gamblers who were too overweight energy names...all good things must come to an end, especially commodity related plays.
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Dec 21, 2005
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London, ON
webber22 wrote: Pengrowth added a note about the dividend stability

http://www.pengrowth.com/investors/divi ... stability/
You might want to flip through their corporate presentation as well -- yes, the hedges will help a bit for 2015/16, but even with higher oil prices, they're borrowing to pay for the dividend (slides 8-10).

They'll probably cut capex first before cutting the dividend, but don't assume they won't cut the dividend because of the hedges
:idea: :) :lol: :razz: :D
Deal Expert
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Dec 11, 2005
19704 posts
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techcrium wrote: I just find it very interesting that you conveniently say this right after oil prices has already crashed and I've never heard of such posts before all this.
Well you don't pay enough attention to my posts because I have been ranting about the changing energy mix for months.
To be nobody but yourself - in a world which is doing its best, night and day, to make you everybody else - means to fight the hardest battle which any human being can fight; and never stop fighting. -- E. E. Cummings
Deal Expert
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Aug 2, 2010
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Here 'n There
I find it so laughable that people who had no problem buying oil stocks at a much higher price are now asking if it's a good idea to buy them a a lower price, lol.
Penalty Box
Apr 16, 2012
3565 posts
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Greely
Some more quotes:
brunes wrote: Im sticking with BNP. They're not going to cut the dividend, they don't have to. So you're paid to wait for the price to recover. I'm bullish on gas, the current low price will not last. Once the economy picks up, Oil is going to be over $120 / barrel and more, gas will then see a huge spike in consumption. Yes, there is a glut of gas on the market right now, but it will quickly dry up as people move away from oil.

As a matter of fact, can we pair the 2 quotes side by side for full effect?
brunes wrote: Depends on what you think the future of oil is. IMO it ain't so rosy. Prices are not going up any time soon, and when they do go back up they will never reach previous highs.
brunes wrote: Once the economy picks up, Oil is going to be over $120 / barrel and more
Deal Expert
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Dec 11, 2005
19704 posts
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techcrium wrote: Some more quotes:




As a matter of fact, can we pair the 2 quotes side by side for full effect?
Way to take two year old posts and use them out of context. A lot has changed since 2012.

See my comments in this thread. oil-price-1573587/

In short

- US fracking a crapton of oil and gas

- Solar taking off like gangbusters

These two things combined show a dim future for oil. Neither of these trends had taken hold in 2012.
To be nobody but yourself - in a world which is doing its best, night and day, to make you everybody else - means to fight the hardest battle which any human being can fight; and never stop fighting. -- E. E. Cummings

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