RIG Is a Short-Term Buy

Transocean's (RIG) settlement with the Department of Justice on Thursday changes my short-term view on the stock, if not my long-term one. But for the next few weeks there is a catch-up momentum that should drive shares higher and I am looking to buy even after the strong rally yesterday.

Off shore isn't in general where I want to be in 2013. As supplies on shore continue to increase while demand in the U.S. continues to slacken, there are simply better investments in scale on where to get crude oil. And I say crude oil specifically. There will be another slack year in natural gas prices making the specific quest for crude oil volume growth the most profitable play in the energy sector again. Offshore drilling continues to yield greater percentages of natural gas to crude and operations must take into account the production of both. Furthermore, off shore continues to not only get more and more expensive as it needs to drill more deeply and more horizontally, it also becomes more dangerous, as Macondo showed as well as the RDS Shell drill rig grounding in Alaska so recently reminded us. As priorities go for investing in energy, off shore is not currently on the top of my list. ...315 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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