13 Great Ways to Invest in Oil Without Buying Barrels
Fact: Today oil futures hit a record high above $88 a barrel.
Whether you like it or not oil prices are on the rise, and how far they go up is anyone’s guess.
If you are one the many bulls, then you may want to get invested. Lucky for you you don’t have to trade futures to get yourself involved, there are easier ways to invest in the commodity which are shown below.
Featured are eleven different stocks and two exchange traded funds, ETFs, that tie in with oil either directly or indirectly: United States Oil Fund (USO), Oil Services HOLDRs (OIH), China Petrolium & Chemical Corporation (SNP), Petrochina (PTR), Exxon Mobil (XOM), Chevron Corp (CVX), Gulfport Energy Corp (GPOR), Range Resources Corp (RRC), Quicksilver Resources (KWK), CNOOC Ltd (CEO), Core Laboraties (CLB), Schlumberger (SLB), Halliburton Company (HAL).
United States Oil Fund, Symbol USO
USO is an ETF that tracks the price of West Texas light and sweet crude oil. The ETF debuted in mid 06 and has become really the ETF for oil. Today the fund is looking to close again at new highs not seen since back in 2006 above $66 a share if not $67.
Oil Services HOLDRs, Symbol OIH
OIH is an ETF that follows various companies from within the oil service industry which has been extremely hot. Some of the stocks that the fund holds are actually listed below. OIH is now trading at just above $200 a share, up some 45% this year. Remember that with ETFs you have no maintenance fees, they are traded just like a stock.
China Petrolium & Chemical Corporation, Symbol SNP
SNP has been red hot and is an international play on China. The stock has well over doubled in price this year and thus far in the month of October is up some 20%+. I would be cautious buying into SNP, make sure you do your due diligence before taking a position as this stock has some wild price volatility. But, if you want to get involved in China and Oil, SNP and the next stock PTR are the way to go.
Petrochina, Symbol PTR
Petrochina almost mirrors China Petrolium listed above if you look at both stock charts. Both have had fantastic runs thus far here September and even better runs in October. As oil continues to move to the upside and China continues to consume more these stocks should continue to move higher in price. A little fun fact for you, with its recent price move PTR has a market capitalization of over $400 billion.
Exxon Mobil, Symbol XOM
XOM has been and continues to be a nice more conservative play on oil as the stock is less volatile as a Petrochina may be. Yesterday XOM closed at new all time price highs just below $95 making the company worth a staggering $525 Billion dollars. Exxon is the largest company in the world based on market capitalization. The stock has had a nice run this year in 2007 as can be seen by the chart below.
Chevron Corp, Symbol CVX
In the same arena as XOM, these two companies almost mirror each other price performance wise. Chevron engages in exploration, production, and refining of oil and gas not only in the United States but also in over 180 other countries. The stock is buy some investor standards a buy after today’s accumulation day price action. As of the close today CVX is worth just under $200 billion.
Gulfport Energy Corp, Symbol GPOR
If Exxon and Chevron are too big for your liking, take a look at Gulfport Energy Corp. This stock is worth just over $930 million compared to the hundreds of billions from XOM and CVX. In the same industry just focused within the United States the stock has had a very nice run thus far in 2007 and looks poised to move higher.
Range Resources Corp, Symbol RRC
Like Gulfport RRC is focused in exploration and production of oil and gas in just the United States. Gulfport is the #1 stock within its industry group, with RRC sitting comfortably in the #3 spot. The next stock below, KWK is also in the top 10 of the same group.
Quicksilver Resources, Symbol KWK
A good long term hold and in the same group as both RRC and GPOR, KWK just today closed today at new all-time price highs… again. I like the chart on KWK and it was most recently a buy back at $48. The stock boasts a market cap of over $4 billion and is up almost 50% on the year. Check out the weekly chart and you can see its chart setup over the last several years.
CNOOC Ltd, Symbol CEO
CEO has had a phenomenal run here in 2007 which really began in June when the stock crossed above $100 a share for the first time. The stock yesterday closed at $188.26 and is up over 90% on the year. The company focuses its efforts in offshore China and in other countries outside the United States. With such a wild price run I can only wonder how high this stock can actually go.
Core Laboratories Ltd, Symbol CLB
Taking a step away from exploration and production is Core Laboratories which is in the services side of oil and gas. CLB is a dutch company that amongst other services provides production enhancement and reservoir management services. This group as been extremely hot lately, and you will see from the chart below a beautiful run from CLB. The stock yesterday crossed above $140 for the first time.
Schlumberger Ltd, Symbol SLB
Another hot stock from the same oil and gas service industry as CLB, SLB too has had a great run thus far in 2007. This company offers technology based services such as project management and information solutions. The stock has seen some good attention from institutions over the last two weeks and today closed at a new high of $112.15.
Halliburton Company, Symbol HAL
The last stock featured atleast in this post and believe me there are many more that could be shown in this post. Halliburton is the third stock shown here within the oil and gas services industry, and like its two colleagues shown above the stock too has been on a run here in 2007 closing yesterday at new multi-year high of $41.48. The company in July of this year has committed to repurchasing an additional $2 billion worth of its common stock.
See anything here you would remove or add? Has oil been played a part in your own portfolio?
23 Responses
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The PTR chart is unbelievable, looks like some of the dot com charts from the late 90’s
Blain,
Thanks for putting together this list. You’ve given some excellent vehicles to speculate in oil for those without the ability or desire to throw money in futures.
Thanks for the list. The oil and gas industry is a complex beast – upstream, downstream, midstream, service, refinery, exploration and production. Many oil & gas companies also pay good dividends but it pays to be diversified as things can get pretty wild at time.
The Dividend Guy
Oh man. Haliburton had to be one of my “doah!” mistakes. I had it earlier in the year and rode it from 30 to 36, but then I closed my position and went somewhere else. At the time the stock when down to 32, so I was happy.
I contemplated to buy back into it at 32 because I knew it would go up, but I felt that I might of had some better options, but now Hal is trading at 41, while my other options didn’t rise as fast.
I usually would let it go, but I feel that Hal is going to hit 50
Anybody know why stocks like WNR are still in a downtrend. I remember daytrading that stock early in the year but lately its been a dud? I would think with oil moving the way it is the company would get some relief
Don’t forget about the Canadian Oil Sands, which they say will be the next big oil resource. Here are some symbols:
Suncor: SU.TO
Canadian Oil Sands: COS.UN.TO
Petro Canada (Smaller oil sands player): PCA.TO
I like COP the best of the majors. SLB is a great play, and I really like DWSN and OYOG as well in the small cap area of energy.
@Bubs, Not really sure on WNR. Financials look much better. Technically, it looks like there’s some support in the 34/36 area. Maybe we’ll see a bounce soon?
I like the outlook for oil but I’m paranoid to buy into a large chinese oil firm for a long term investment… I’m just paranoid about two super powers not getting along at one point or another in the future… Who knows what happens to foreign assets in a communist country during harsh times? Not saying it will ever happen… I’d look for plenty of other plays… go check out the Canadian oil sands… 300+ billion barrels of oil and more being found all the time (not all recoverable) or some of the Oil Income Trusts which have had their values slashed DRAMATICALLY and are now undervalued and giving out 16%+ dividends until 2010 when they must convert to traditional corporations… and many are targets of acquisition at the moment.
Blain your next post should be about gold, similar to this post.
That’s a great idea for next week, thanks Bubs
I’d be nervous buying oil at these levels. I think it’s almost consolidation time.
Yeh I would be nervous to at these levels but any escalation in the Middle East and we will be watching oil trade in the triple digits
All those charts – up up up. You’d think they were .coms back in 1998
Nice blog, With some valid points.