I’m not talking about the gas you get from food or drink consumption. It’s time for gas commodities to move up: crude oil and natural gas. MarketClub has given me access to a technical analysis video for crude oil: check it out. I think we hit a nice bottom, and it’s time for oil to move up. It has reached such a low price for a commodity that will continually be needed in this world. It’s like black gold. I’d expect to see $60 per barrel of crude oil within the next few years again. Although I expect it hit $60 probably within this year maybe even this summer when gas prices start moving up.
The Market Club video establishes that is a great time to get into USO. I’m not too much a fan of this ETFs especially with so many undervalued gas stocks. I’d suggest looking into PWE, Penn West Energy, a stock giving a dividend of over 11%. It is able to sustain this dividend as long as oil stays above $50. This is a great stock that is priced very low and it will easily double up as oil starts moving up. You can’t see this type of action with the big oil companies. If you are a more conservative investor, I’d suggest looking at BP, British Petroleum, at a price of $48 currently. I earlier stated around $40 that it was a great buy, but if you have not got into it and your money is sitting in a bank account, you might as well buy some of this stock and get a nice 7% dividend.
On the natural gas commodity, there are multiple companies that are deeply in debt and it’s risky to buy any of them that can go bankrupt. However, we can still play this market with the UNG, United States Natural Gas, a hedge on the natural gas. Summer is coming up and natural gas will not be used that much, but with the recession ending and wide spread inflation coming up, expect commodities and natural gas to finally make its move up. It’s reach lows such as $4 million British thermal units. Just a few years ago, this would have been $12 mbtu.
Remember, we’re looking at the long term. These are easy plays to make money within a few years time.
