According to Reed Cagle, a few factors can cause the price of oil to fluctuate dramatically. First and foremost, the industry is extremely competitive. Profits can fluctuate wildly by a few cents on the dollar. Second, crude and refined product prices are extremely volatile. Profits can spike and fall as a result of even minor changes in demand. Third, climate change has the potential to affect oil and gas prospects.
However, there are some promising prospects in the oil and gas industry. In addition to the OPEC cartel, the world's largest oil companies have the ability to influence oil prices. For example, crude oil prices can rise or fall based on different countries' capital allocations.These factors will also have an impact on the price of oil.
Reed Cagle believes that, OPEC is an oil-exporting cartel that coordinates policies and sets the price of oil. OPEC's actions can have a significant impact on the price of oil. following the announcement of OPEC's 2020 price cuts, Russia recently agreed to reduce its output. Crude futures fell in value as a result of the news. In a short period of time, the company was able to persuade Russia to reduce its oil output.
The BRIC economies' economies have resulted in an increase in oil production and prices. Oil prices have fallen as a result of the use of hydrogen and renewable fuels.As a result, the oil share price is likely to fall for a long time. Oil stock should be avoided by investors, but it is still a good option for those looking for a dividend. In Reed Cagle opinion, it is critical to select oil companies with low operating costs and consistent cash flow streams. Oil prices below $40 per barrel should be profitable for E&P companies. While there are numerous opportunities in the natural gas industry, it is important to keep in mind that the industry typically follows economic cycles. As a result, investing in natural gas stocks may be the best bet in the coming years.
While oil prices have increased in recent years, investors should keep in mind that the industry is still recovering from the low price of crude. Over the last decade, the price of oil has been volatile. While there have been numerous positive developments, there have also been some risks. Finally, many renewable energy companies are gaining market share.
