Buy Oil Now and Thank Me Again Later

The last time I told you to buy oil and thank me later was October 13, 2021. 

At the time, WTI crude was trading for $80.44 per barrel, and people were already lamenting the $3.28-per-gallon price tag they were paying at the pump. 

But let’s face it — we’ve been spoiled with cheap gas for years. 

If you told me a year ago that someone was complaining about paying $3.80 for a gallon of gas, I wouldn’t have believed it for a second. Then I would’ve gone out and filled up my tank for $4.25 a gallon.

Even today, with WTI trading just a few bucks short of $80 per barrel right now, the average price for a gallon of gas in the United States is $3.47 a gallon. 

Of course, you know just as well as I do how my prediction went. 

Over the next eight months, crude oil prices surged to near-record highs above $120 per barrel. 

It was an undeniable smorgasbord of oil profits in 2022. 

And I think it’s going to happen again…

At some point this summer, my readers and I are going to turn back to today as the moment when our sentiments shifted even more bullish. 

Why?

Well, oil prices have been consolidating over the past few months and seem to have settled into a trading range between $70 and $80 per barrel. 

Now, we both know that the EIA’s data has been suspect for a while. Again, it’s not entirely the organization's fault, and if we’re being charitable here, the first step is always admitting there’s a problem. 

For us, it was being told demand was at peak pandemic levels last August. 

That was one moment when we couldn’t help but call bullshit. 

While oil prices were consolidating, rising crude stockpiles — thanks to things like seasonal demand and refinery maintenance — effectively put a cap on prices this winter.

Now it appears the tides have turned bullish again.

This week, the EIA reported a 1.7 million-barrel drawdown in U.S. oil inventories over the previous week. Meanwhile, gasoline inventories declined by 1.1 million barrels, and both gasoline and distillate inventories (think diesel) are below the five-year average. 

Remember, this is supposed to be the weakest part of the year for oil prices. 

But there was something else in the EIA’s weekly oil report that, while not an emergency, is interesting to note. 

It turns out that U.S. oil output fell by 100,000 barrels per day over the previous week. On the surface, this isn’t a massive data point, but it is a red flag to be aware of. 

You see, despite the wild ride oil prices had in 2022, U.S. oil production is still 800,000 barrels per day lower than our previous peak of 13 million barrels per day back in November 2019.

Meanwhile, demand within the U.S. remains strong, and China is finally starting to show definitive signs that its thirst for crude oil is back. 

I’m not suggesting that U.S. oil companies will suddenly flounder and collapse — far from it.

However, this time won’t be like 2022. The trick for investors like us is to find those hidden gems operating in the most lucrative oil fields in the United States. 

I strongly recommend you take just a minute out of your day right now to check them out.

Like I said, buy oil now and thank me again later. 

Until next time,

Keith Kohl

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A true insider in the technology and energy markets, Keith’s research has helped everyday investors capitalize from the rapid adoption of new technology trends and energy transitions. Keith connects with hundreds of thousands of readers as the Managing Editor of Energy & Capital, as well as the investment director of Angel Publishing’s Energy Investor and Technology and Opportunity.

For nearly two decades, Keith has been providing in-depth coverage of the hottest investment trends before they go mainstream — from the shale oil and gas boom in the United States to the red-hot EV revolution currently underway. Keith and his readers have banked hundreds of winning trades on the 5G rollout and on key advancements in robotics and AI technology.

Keith’s keen trading acumen and investment research also extend all the way into the complex biotech sector, where he and his readers take advantage of the newest and most groundbreaking medical therapies being developed by nearly 1,000 biotech companies. His network includes hundreds of experts, from M.D.s and Ph.D.s to lab scientists grinding out the latest medical technology and treatments. You can join his vast investment community and target the most profitable biotech stocks in Keith’s Topline Trader advisory newsletter.