Big Oil’s big Future

Once again I managed to get an article published (together with dodgy mugshot) on the Dubai business portal Alrroya.com. The full text of the article is here Big Oil's big future but in essence it is a piece for investors advising that the common view of oil companies as lumbering dinosaurs headed for extinction is misplaced. They are actually well-placed for a future in which the "easy" sources of oil are drying up. They are already struggling to replace the reserves they use up pumping oil to their refineries to meet current demand and this trend is set to worsen but the gloom is overdone. For one thing they are increasingly not oil companies as they get more involved in gas production which will be increasingly important as an energy source (even if it is a drag on profits right now). Secondly the search for new sources of oil plays to their strengths in some ways. Thirdly there is a technical argument that earnings will become more consistent when easy oil runs short (because prices will be permanently high and investors need not worry about the vulnerability of the companies expensive oil projects to a price bust). Finally the oil companies will get into renewables when the time is right and be big players in whatever new form of energy system replaces the current hydrocarbon dominated one. The pros outweigh the cons in my view and they are good investments for the long term.

Any way the article arose from my keen interest in energy and environmental issues which I see as both a huge challenge to mankind (certainly the rich lifestyles of the rich world) but also a great investment opportunity for those prepared to think long term. Thanks to anyone who has clicked on my articles in the past few weeks (the others were on the gold price and global warming data scandals). But for now back to my day job and preparation for the Spanish income tax season. New article on tax http://www.ehow.com/how_5945557_work-do-spanish-tax-return.html