Why Barron's Has It Wrong on Oil

The Barron's cover story on oil from July 15 was an incredible miscommunication on where the market is likely to go. And while they might have come up with some rather decent recommendations in weathering the extended oil bust -- with Exxon Mobil  (XOM) , Chevron (CVX) , Canadian Natural Resources (CNR) and Suncor (SU) -- their math and methodology is way off. It's important to fully understand that math before making a new oil and gas investment decision.

The oil cover story on Barron's tried to highlight oil companies that they said could operate profitably with $50 oil. Their major thesis in developing this list of recommendations relied upon a trend of increasing capital expenditures in oil exploration and production companies, without the concurrent production increase that historically is supposed to follow along with sharper spending....508 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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