Is investing in Oil/Gas a good idea? If yes how do i start. is there any website i can consult to educate?

Question

myself about how to start investing?

Answer 1

I would not recommend investing in petroleum at this time, the market is very shakey. I might be good in a diversified portfolio as you may catch an upswing and then be able to dump. Commodities are a tough racket, try something a little more stable. If you want a gamble find some up and coming technical company in China, invest and then get out before the Chinese government kicks out all foreign investor. If you really want commodities trading, buy corn.

Answer 2

The short answer is yes. Oil is a finite resource, so as the world population increases so does it's consumption of natural resources. A true shortage is far on the horizon (20-30) years, and their are risks of new energy sources replacing traditional oil; but the laws of supply and demand will ensure oil prices to raise in the mid to longer term.

You can buy (or short) oil in an ETF or index very easily. They trade like regular mutual funds. Yahoo Finance has excellent research and learning tools. I work in an investment house and still use it all the time.

To start investing i suggest mapping out a savings plan and setting up a "phony" money portfolio on yahoo or other free site. Try your stock picks there first, and as you study them and educate yourself (by reading the 10k etc) you will learn alot.

Stock picks are NOT easy, it is sometimes very complicated and the markets move very fast, so until you are comfortable picking them on your own, perhaps it's best to consult a professional.

Remember, diversification is your friend. Don't put all your eggs in one basket and read everything on a companies website (especially under the Investor Relations tab) before you buy.

Happy Hunting

Answer 3

I can't answer your question directly but, think about this. You want to invest in Oil or Gas? Have you thought about buying Iraqi Dinar? There is tons of hype on it all over the internet and most of it is probably bs. You will see people selling Dinars on Ebay spouting off about the Dinar being valued at $3.82 right after the first Gulf War ended and their belief that it will return to that soon. After this they remind you that you can current buy 1 million Dinar for an inflated Ebay price of $900 to $1200, and that Dinar are only valued at .00077 U.S. cents each right now. Pretty simple to do the math here. Buy 1 million Dinar for $1000 and if they are right and it returns to the '91-'92 rate of one Dinar being worth $3.82 USD you would have $3,820,000. Not bad for a $1000 investment. What they leave out is that Saddam is the one you said "this is my country..this is my dinar..I say it is worth $3.82 USD. No where else in the world was it valued higher than 32 cents.

The bad/good news here is that the new currency belongs to a new country. Iraq isn't what it used to be and isn't ran by the old government. Therefor the currency isn't going back to where it was. At the same time, now the U.S. has a particular interest in making that country work so there might be a chance.

My advice is to do like I did. By only a little bit. Don't invest any more than you are willing to lose completely...then hold onto it for five or ten years. When that time has gone buy you will either have a handful of useless paper..a pile of near worthless paper valued at the same thing you paid for it..or a nice little wad of cash if every politician in Washington has been buying Dinar for them self did their very best to ensure Iraq's economy became strong and their currency became strong. That is why I bought some..not because I trust the competence of Iraq's new government but, because I trust the greed of our own politicians.

Answer 4

There are two ways to invest. One is stocks in companies that produce oil. There are a few different kinds of companies in this field.

The other way is buying futures.

If you are a beginning investor you need to read some books on investing. Women tend to be better investors than men. So read a book by a woman and increase your potential for success.

You can get them from the library for free. From the web for about $6 if they are returns (just like new).

Next, I would recommend reading the Elliot Wave Theory. It measures indexes. You may be surprised what the Elliot theorists have to say about oil and investing in it. There is a web site but read the book first to get an overview.

You’re not ready yet. Next read the Innovators Solution by Clayton Christensen. It explains about market disruptions. It will give you the blueprint for knowing which type of business could enjoy explosive profits.

You’re still not ready. Add to all of this the reasonable factor. What is that? Look at what happened to the whale oil industry. It no longer exists. Why? What replaced it? If you think in this way, you can decrease your risk and increase your potential to profit from the market.

Oil sounds like a gloom and doom profit maker. In reality it is a gloom and boom profit maker as new energy disruptions enter the market.

Oil is poised to be disrupted just like Bethlehem Steel and other giants who no longer exist.

Answer 5

oil and gas is a "sector" and as such holds special risks. It is a commodity play. Within the last year, oil was at $78 / barrel, now it is Around $56, That is a big swing in price and stocks are more volatile than the commodity.

If you want to start out investing, read and learn everything about markets, but start investing by putting your money into a "balanced" mutual fund at your bank.

It has far less volitility and is much safer than sectors.

Answer 6

It should be alright to invest for about the next 10 years, but the world is rapidly changing and you can think of it as investing in the steam engine when most people are still using this form of transportation, however metaphorically scientific discovery is starting to discover oil, so it would be a rather short term investment (something to sell in about 6-8 years)

Answer 7

Well, sure except you have to consider that other people know that too. This means, that just "investing in Oil/gas" could lose you money. (One useful guide in the P/E. Stay away from penny stocks. PRICE OF STOCK/EARNING PER SHARE. The larger the more overvalued the stock.)

Lots of WWW sites. I recommend fools www site but some basics to consider:

If your smalll investor mutual funds or index funds might be better choice. Less risk and you get more diversity in small investment. (Less risk means less loss and less gain.)

http://www.fool.com/

You might also want to consider whether to get financial adviser. I find they are sadly more "preditory" than before but might still give good advice.

Other things to read:
- Wealthy Barber - gr8 canadian book
- Why not to invest in Mutual funds
- why to buy bonds

Answer 8

Personally I would stay away from investing in Oil/Gas. It is very capital intensive work with many risks. With the stock market looking like it is do for a correction. The value of the dollar falling, maybe Gold would certainly be safer then oil at this time.

Answer 9

I would look into investing in Fuel Cell research. It's not big now, but it shows promise. It's probably what will run all cars someday, getting rid of the need for gas.

Answer 10

Sure, for the long term. I suggest that you diversify with a no-load mutual fund such as T. Rowe Price New Era Fund -- they've an excellent record and are a very credible organization. You can locate T. Rowe Price Funds very easily with a Yahoo Search. You can also go to Morningstar for ratings on funds. Good luck.