Oil and gas prices have been quite stable throughout January 2012 but no one really knows how long this apparent stability is going to last. The Deputy Executive Director of the International Energy Agency, Ambassador Richard Jones, warns that those expecting a tranquil oil and gas market in 2012 may be disappointed because there is scope for some supply related problems and even economic slow-down later in this year.
Moreover, oil prices have been oscillating between $100-120 since March 2011, so a high price per barrel is somewhat firmly established. This is an obvious problem for oil importing countries such as the US and therefore is a significant reason behind the elevated interest in domestic drilling ventures – both on shore and off shore.
One can find from most sources of statistics that the number of rigs and onshore wells being drilled is steadily going up every year. This has opened up multiple opportunities for investors looking to expand their portfolio to the oil and gas sector. High prices compounded by the need to generate domestic sources of energy have led to the accelerated growth of the drilling sector.
The good news is that the growth rate is quite steady and is likely to continue even if the oil prices turn a little shaky this year. Companies like Chevron and Conoco Phillips have had stocks with a persistent uptrend since last year and have forecasted potential upsides of 10-15% for this year. Since these companies are based in Texas and have majority of their operations located within the state, their stocks make for very reliable buys for investors. Some investors may also like to explore other avenues in the oil and gas industries this year. Direct investments in exploration and working interests are expected to return fruitful returns in 2012.
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