Why Do Oil and Gas Investments Belong in Your Portfolio?
Energy is the linchpin of modern industrial society, enabling us not only to light our homes and drive our kids to school, but also to power factories and heat offices, thereby creating jobs and wealth. Petroleum and petroleum by-products are utilized by consumers every day in ways they don’t even realize. In addition to gasoline and home heating oil, consumables from plastics to toothpaste, shampoo to house paint, and even antihistamines contain some form of petroleum. It's hard to imagine life without these everyday conveniences!
Demand for products originating in the oil and gas/petrochemical industry is increasing dramatically on a daily basis. Growing economies such as India and China are the driving force behind especially rapid surges in demand for energy and plastics.
While efforts to expand alternative energy sources are increasing, the costs involved are prohibitively expensive, and are unlikely to yield a significant return for investors for many years to come. Even when they do, they still will meet such a small percentage of the total energy need that their impact upon the oil and gas industry will be minimal.
Do oil and gas investments belong in your portfolio? We definitely think so for two reasons:
- Oil and gas are key components of daily life, and that fundamental fact is not going to change.
- Based on the global oil supply and demand, we expect prices to remain at relatively high levels for the foreseeable future, thereby reinforcing the already attractive economics of the investment activities we offer you.
A better understanding of the global supply and demand for oil underpins this conviction.
