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General Investing and Economics Discussion - No Politics
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<blockquote data-quote="Deleted member 2897" data-source="post: 710983"><p>I worked for a major oil company for several years in an earlier life. The longer term contracts are changing hands around $20/barrel. They can make money there, but its going to be really hard. Anytime you're under $30/barrel, you're really skimping on capital projects. XOMs trailing PE is 12. And their earnings are about to get punched in the face since oil has cratered here in the last month. Most analysts are predicting XOM to make no money this year. Oil companies are also some of the least profitable companies in the world. XOM's profit margin is 4.5%. Most people wouldn't even get out of bed for that. They also have over $50B in debt. If it were me, I wouldn't make a play on oil right now. Its just a complete mess. If you're into speculation and you're willing to take a risk, I'd look at an ETF that tracks oil further out in the future like maybe BNO and USO. I actually did that after the great recession for awhile - I was in BNO huge. But its such an unnatural mess right now its not really for me. But I could definitely see those ETFs popping up and down quite a bit over the next several months to allow for making of some good short term trades.</p></blockquote><p></p>
[QUOTE="Deleted member 2897, post: 710983"] I worked for a major oil company for several years in an earlier life. The longer term contracts are changing hands around $20/barrel. They can make money there, but its going to be really hard. Anytime you're under $30/barrel, you're really skimping on capital projects. XOMs trailing PE is 12. And their earnings are about to get punched in the face since oil has cratered here in the last month. Most analysts are predicting XOM to make no money this year. Oil companies are also some of the least profitable companies in the world. XOM's profit margin is 4.5%. Most people wouldn't even get out of bed for that. They also have over $50B in debt. If it were me, I wouldn't make a play on oil right now. Its just a complete mess. If you're into speculation and you're willing to take a risk, I'd look at an ETF that tracks oil further out in the future like maybe BNO and USO. I actually did that after the great recession for awhile - I was in BNO huge. But its such an unnatural mess right now its not really for me. But I could definitely see those ETFs popping up and down quite a bit over the next several months to allow for making of some good short term trades. [/QUOTE]
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