debir Wrote:
Dec 01, 2012 9:05 AM
There's a wrong way to invest in the oil and natural gas boom. Hear about a big new oilfield and buy shares of the Co that's exploring it. This didn't work out for shareholders of Chesapeake during the natural gas boom, which's like our playbook for what's about to happen with oil. What you can see is, even though Chesapeake came from nothing to be the 2nd-largest producer of natural gas in the US behind Exxon-Mobil, its share price got slammed when the price of natural gas fell in 2012 and the Co's finances were revealed to be weak. That's what you've got to watch out for with the oil boom. Production rates at small oil Cos in the US are going to soar. There'll be lots of buyouts, takeovers.