Oil Runs Again, Driving Big Oil Higher

As oil continues to run higher on unrest in the Middle East and Northern Africa, big oil companies are enjoying larger profits in the short run. Chevron Corporation (NYSE:CVX) is trading at $103.52, +3.20 (+3.19%) while Exxon Mobil Corporation (NYSE:XOM) is trading at $87.22, +1.78 (+2.08%). These companies surged dramatically higher yesterday on oils strength and are doing so again today.

While higher oil does mean more profits in the short term, it is not that way in the long term. As oil and gas prices rise, global demand will start to wane. If oil prices continue to rise, global instability is going to increase as inflation continues to move higher. Eventually, as consumers recoil from the massive surge in energy, demand for oil will drop and profits for big oil may start to drop.  The big question will be, at what price does this occur. Many believe it may start at $100.00 oil and others believe at $115.00. In 2008 oil reached $150.00 per barrel. The global economy was much stronger then and it still collapsed into the financial crisis we have seen.  What will happen this time?

About Gareth Soloway 168 Articles

Affiliation: InTheMoneyStocks.com

Gareth Soloway has been an avid swing and day trader since his days at Binghamton University where he studied Economics. After college, Gareth quickly excelled as a financial advisor, helping clients get their financial houses in order. While helping others gain financial independence, he continued to study the day trading and swing trading world, developing a unique market philosophy and proprietary methods. Following his work in the financial sector, Gareth went on to trade alongside professional traders. Unable to tolerate the hype of Wall Street any longer and having an amazing ability to profit using his developed techniques, Gareth Soloway decided to partner with his friend and colleague, Nicholas Santiago to form InTheMoneyStocks.com. Chief Market Strategist Gareth Soloway serves as the president and CFO of InTheMoneyStocks.Com.

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