Arbitrage in the Oil Field
Crude oil is trading near $100 a barrel, but oil services stocks continue to underperform, with critical issues keeping a lid on the upside. Clearly, investors have turned gun-shy in 2011, worried the next energy disaster will turn a good investment into a nightmare. And while Gulf oil production has now returned to pre-spill levels, the industry will pump less oil from those waters this year than it did in 2010.
New federal drilling and environmental regulations are still in the pipeline, although they look less onerous than the draconian proposals put on the table right after the catastrophe. Meanwhile, the chief culprits have returned to the front pages, with legal discovery igniting waves of finger-pointing among the numerous defendants....511 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
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