Strictly: Drilling and oil-field services Message Board

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Gold/Mining/Energy : Strictly: Drilling and oil-field services

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To: John Doyle who wrote (77433)	10/27/2000 1:53:04 PM
From: rolatzi	Read Replies (1) of 95453

OSX just reached 111 and turned up to 112 for the moment. Anyone buying at this level? Drilling and service companies may find an aborted recovery if we go into recession. It is already clear that many large players haven't really committed to drilling in a big way. At this point it may be safer to remain in energy production than drilling and service as those companies that produce hydrocarbons have real profits. Unless the price of oil and NG crash they will remain profitable. It is unlikely that OPEC will allow the price of oil to decline back into the lower 20's. It is not even clear that OPEC or SA can supply the amount of oil that they are committed to by the price banding agreements. If there is a period of stagflation and people move into hard assets, oil and gas companies represent a useful hedge. Furthermore a decline in the dollar will lessen the ovserseas pain of buying energy in cheaper dollars leading to a floor on the demand side. What do you think and is this board working today? rolatzi

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