Investing in Oil

chile_paul

With Brent crude prices hitting a 5 and a half year low today I was wondering whether anybody was looking to invest in oil in the expectation that it will return to $100+ prices over the long term?

I'm thinking that for a small percentage of my portfolio (which I can afford to lose and would not need to access for 5-10 years) this may be a good investment?

I'd be interested in people's views and experiences and any guidance on the best way to do this - I know there are a number of funds that track commodities in general as well as ETF's. Any views on the best way to invest??

Kendall80

Its a tough one. Some are predicting $50 to $60 to become the 'new' norm whereas others suggest $90. I have gone for a relatively small investment in Tullow Oil. I may also invest in a hedged natural gas or brent crude ETF (ETFS) if prices dip even further.


I am cautious regarding the amounts as I also hold Russia which can be viewed as a commodities play in itself.

inflationbuster

I have been adding to my BP. holding which is yielding 6% right now.

jimjames

There is a Junior Oils fund that may be suitable.

As suggested you could also buy oil companies or country funds that are reliant on oil.

colsten

jimjames wrote: »

There is a Junior Oils fund that may be suitable.
.

Junior Oil - is that oil that isn't quite oil yet and needs a few more million years to become oil? As in you leave out an H or an F from this proper oil formula

Seriously, what are Junior Oils funds?

Thrugelmir

inflationbuster wrote: »

I have been adding to my BP. holding which is yielding 6% right now.

Is the dividend sustainable at this level?

Nor is BP clear of litigation in the US yet in relation to Deepwater Horizon. .

masonic

colsten wrote: »

Junior Oil - is that oil that isn't quite oil yet and needs a few more million years to become oil? As in you leave out an H or an F from this proper oil formula

Seriously, what are Junior Oils funds?

You're more likely to find that in a cream, but if you're allergic to the commodities sector it might give you some relief.

I think junior oils come from baby dinosaurs.

colsten

So what exactly are Junior Oils? I really do like to know.

irm

colsten wrote: »

So what exactly are Junior Oils? I really do like to know.

Smaller, or emerging companies in the sector. I think.

masonic

I assume the fund invests in fledgling oil explorers and producers.

inflationbuster

Thrugelmir wrote: »

Is the dividend sustainable at this level?

Nor is BP clear of litigation in the US yet in relation to Deepwater Horizon. .

Both are indeed risks but BP did raise the dividend for third quarter despite lower oil prices.