Who’s making money off of high gas prices?
You’d think it would be the oil refiners. But it’s not. Their margins are so small as to be nearly invisible to the naked eye. So you don’t want to invest in them.
The big oil companies are making loads of money, but their share prices are barely going up. That’s because investors have noticed that even though their profits are growing, their oil production isn’t. Exxon Mobil, BP, and Royal Dutch Shell showed lower oil production for the latest quarter they reported on.
How about those companies making hybrid cars? Should you invest in them? Careful. Hybrids and electric cars are a fraction of what auto manufacturers sell. You’d be investing with your heart and not your brain if you go down that road.
The one gas play you could make is with the rig companies. Oil companies are desperately searching for more sources of oil – and at the current price of crude, they can afford to pay for as many drilling rigs as they want. Except there are only so many to go around, and the wait for new rigs is getting longer and longer.
Companies that make onshore or offshore drilling rigs are taking in record profits. When almost all sectors of the stock market are going down, this little-known corner of the oil patch is making big money. And that’s where you want to invest your money.
[Ed. Note: We're in a recession. But in certain corners, it's raining money. To get your fill, you just need to know where to put your bucket. Investing expert Andrew Gordon can show you how.]
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