iShares Dow Jones US Oil & Gas Ex Index (IEO)

All Comments on IEO

  • commenter
    Kunst
    Aug 22 10:45 PM
    Will Crude Oil Break $100/Barrel? [view article]
    There is a difference between demand and ability to pay, or between demand at one price and demand at another. The entire world is affected by high oil prices, developing countries more than the US. China has a huge trade surplus with us, but do they want to send it all to the middle east for oil? Most countries don't have the foreign reserves China and a few others do. They have lower incomes, especially disposable incomes.

    Oil consumption in developing countries will drop more than in the US.     Reply
  • commenter
    longoil
    Aug 21 03:50 PM
    Will Crude Oil Break $100/Barrel? [view article]
    Oil prices are behaving normally. Everyone is always looking for conspiracy theories.

    Greatest demand and highest prices are in the heating months and summer driving months: Dec thru Feb and May thru July.

    August and September have generally had low oil prices, since the summer driving season is ebbing and heating demands are very low.
    Reply
  • commenter
    John Egan
    Aug 21 02:06 PM
    Will Crude Oil Break $100/Barrel? [view article]
    I agree with most of what 'mangolfer' states... The one point that I have an issue with is that oil inventories are very tight and it doesn't take much of an issue to push prices one way or the other. Couple that with a hyper-kinetic ADHD style market and you have extreme reactions to relatively small changes.

    I'd also like to point out that although this article and the following comments may be true of oil, I think that coal is a different story.

    jegan ;-)     Reply
  • commenter
    David martin
    Aug 21 10:24 AM
    Will Crude Oil Break $100/Barrel? [view article]
    The article misses the most consistent sources of rising demand - the oil exporters, where prices are often far below world prices.
    With supply broadly static for the last 3 years (extraction has exceeded new discoveries for around 30 years) and rising demand in the exporters that will mean less available for export regardless of China and India.
    Exports from other major areas like Mexico and Venezuela is collapsing already, and ramping up in other areas is by no means taking its place.     Reply
  • commenter
    you_can_call
    _me_Al
    Aug 21 08:08 AM
    Will Crude Oil Break $100/Barrel? [view article]
    Mangolfer, thank you, thank you, thank you.

    Why can't CNBC also point out the obvious?     Reply
  • commenter
    mangolfer
    Aug 21 07:33 AM
    Will Crude Oil Break $100/Barrel? [view article]
    From another SA article about China consumption

    Where I find flaw in this China-Olympics theory is that the media makes it out to be that there are only two consumers in the world of crude: the U.S and China. Everyone says that this decrease in demand is thanks to the slow down in China to clean up the air before the Olympics. Did everyone forget that the rest of the world, including emerging markets like Russia, Brazil, and India, have NOT slowed down because of the Olympics? To add, China did not close down production countrywide, but only in Beijing and a few other small factory and port cities. Beijing is less than 2% (1.7% by my math in 2007) of China's GDP.

    While the rest of the world (92% of energy consumption) continues to consume at its pre-Olympic pace, oil has fallen $35. Yet, CNBC won't stop talking about the impending hurricane of demand that will come from China. I disagree.

    As I have already said, most of China is still consuming at its pre-Olympic pace too.

    Let's do a little guestimation: China accounts for 8% of world oil consumption (1/3 as much as the U.S). Let's say that Beijing consumption has slowed 50% (it didn't). By limiting traffic, it is estimated that only 1/3 of the 3.3 million vehicles will stay off the road daily. Non-discretionary consumption should stay flat. So, 2% of 8% is 0.16% of world consumption, or approximately 138K barrels a day of consumptions. Going back to our 50% decrease in consumption number, Beijing purposely decreased its Beijing consumption by 69K barrels a day. There goes the ramping up thesis. 40 factories here and there don't significantly raise that number in the context of world supply.

    My point is that China's actions have not significantly, or even marginally, cut demand. However, in the same time frame, Crude Oil has fallen from $148 to $113. To say that the slowdown in China is because of the Olympics is a canard. Furthermore, China has curtailed gasoline demand by raising prices 17% in late June and OPEC has increased supplies.

    The Chinese tried very hard to piece together their country before the world arrived. It is arguable that the super spike we saw in oil was because China tried to complete in months what they should have built in years. Now, I will argue that progress (and consumption) will slow from here. Growth tends to slow post Olympics in host countries.

    Reply
  • commenter
    ChinaMart
    Aug 21 07:07 AM
    My Website
    Will Crude Oil Break $100/Barrel? [view article]
    Millions of cars in China will be back on the roads and factories around Beijing will return to production after the Olympics are over and the restrictions on air-polluting activities are lifted. China demand will go up again. OPEC is talking about cutting production to keep prices higher. Oil will not see sub $100 again. Ever. Reply
  • commenter
    mkreisel
    Aug 17 01:55 AM
    Negative Trend for Oil Exploration and Production Stocks [view article]
    COP is cheap even at $60 oil. Reply
  • commenter
    gigem77
    Aug 15 10:01 PM
    Negative Trend for Oil Exploration and Production Stocks [view article]
    The market does not apply a large multiple to energy shares. For example, DVN is expected to make 12 bucks this year. But their PE has been 10 or below all year. Apply any reasonable multiple to 12 and look at today's price.

    We have a 10 year uptrend in crude, which is still very much intact. But all of the punditry writing for seekingalpha is from daytraders trying to extrapolate a paradigm shift from 5 weeks of correction. The analysts revising earnings are getting twitchy also. I agree with Mr. Stolz, this is an great opportunity to buy.     Reply
  • commenter
    Timothy
    Stolz
    Aug 15 08:19 PM
    My Website
    Negative Trend for Oil Exploration and Production Stocks [view article]
    It's always of interest reading what Zacks has to offer and then watching the markets to see if the majority of the "investors" followed that advice. Most mass movements of the majority point of view are usually wrong.
    My interpretation of the "Estimate Revisions" is that they are probably too bearish. The oil & gas sectors seem to be primed for stock price and earnings stabilization with a period of steady growth soon to follow.
    The "present time" affords a unique and unusual opportunity to acquire equity positions in very valuable companies. Take advantage of it!     Reply
  • commenter
    huangjin
    Aug 14 10:11 AM
    Negative Trend for Oil Exploration and Production Stocks [view article]
    Analysts value E&P companies on earnings estimates, investors value the present value of reserves plus future production. What do I care about natural gas prices in October when I am looking at production and reserves in 2010 and beyond? Reply
  • commenter
    freefall51
    Aug 14 10:11 AM
    Negative Trend for Oil Exploration and Production Stocks [view article]
    I hate to admit this. But whenever I followed Zacks advice as a subscriber I lost money. Zacks is most mostly a momentum - go with the flow -service. Once the flows has been identified the market turns around on a dime. Better to buy conviction and keep the view on the horizon. Reply
  • commenter
    Whisper On
    The Wind
    Aug 14 09:25 AM
    Negative Trend for Oil Exploration and Production Stocks [view article]
    Oil won't go back to $50 or $70 or even $90/barrel anymore than bread has gone back below $1/loaf. Reply
  • commenter
    peacefulvall
    ey59
    Aug 14 08:15 AM
    Negative Trend for Oil Exploration and Production Stocks [view article]
    While your article accurately notes the recent decline in crude and natural gas prices, it contains serious shortcomings. First, most E&P company stocks did not rise proportionately with the sharp rise in energy prices we witnessed in the earlier part of the year. Analysts wisely discounted a portion of this rise as a bubble-type phenomena. Second, E&P companies are more accurately measured by multiples of cashflow rather than earnings. Anadarko, for example, produced discretionary cashflow of $2.31 billion in Q2---the equivalent of approximately $19.62 on an annualized basis. This means the company, at $57 per share, trades at a stunningly low 2.9x cashflow. Third, there is extreme disconnect presently between equity values an Net Asset Values (ie: reserves) with many E&P companies trading at roughly 50% to 60% NAV. In summary, there is very little downside in the higher quality large E&P companies even with a return to what many industry experts would consider sustainable pricing: $80 crude and $8 natural gas. Reply
  • commenter
    fxtrader07
    Aug 14 07:04 AM
    Negative Trend for Oil Exploration and Production Stocks [view article]
    analysts were slow to revise upward when oil went up and were slow to revise down when oil and gas tanked. however, most oil and gas stocks never reached bublle valuations of any kind. in fact i would very much challenge your notion of an 'energy bubble'. what we have seen is the first(!) echo of a dollar and credit bubble starting to unwind, reflected in a rise of formerly depressed commodities (overvalued dollars bought too much of a barrel of oil). Now we see a healthy correction. Most e&p companies can live with oil at 80-100. heck, cop and apc and others will make a ton of money from $90 oil.
    valuations are reasonable to dirt-cheap in this sector as long as you do not ecpect oil to drop below 70 for any sustained period of time. Howvere, if that were to occur, I suspect the entire stockmarket would crater by 50%+ as that would signal a global depression unheard of since the 1930s     Reply

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