Peak Oil News and Message Boards

Hello everyone. Long-time-lurker, first-time poster here. I'd probably describe myself as somewhat of a doomer, taking a "punctuated equilibrium" (not my term--from biology) view rather than expecting TSHTF everywhere in short order. For example, New Orleans would be one of those places where the "equilibrium" has been "punctuated". I kind of expect that we are in a slow grind downward over the long run with the occasional city falling to the wayside from time to time, as well as the occasional nationwide sudden drop here and there (such as 2008).

I was wondering what you all's take was on the *near* to *medium* term outlook for big oil companies (Conoco Phillips, Exon, Chevron, etc.) I am bullish on commodities in general (metals, energy, and timbre land especially) but feel like some are kind of overvalued (gold, silver). I really have a hard time getting a feel for where oil prices are likely to go, given their volatility over the past decade. I'm wondering if many of these companies are good investments given the long term outlooks wrt climate change and peak oil, or will companies like COP, XOM, CVX, etc go the way of the buggy whip and sail-makers?

I look forward to hearing you all's thoughts...thanks!

Hi planner.

I'm not a gambler in the markets but valuations of commodities companies probably are based on current revenue but also in large part on their future potential (reserves in the case of energy) and since reserves are based on price (how much can be extracted at a certain price) then the future value must be a function of how much people can afford to pay.

So if you think high energy prices won't be a big deal for the economy, then by extension you'd decide not only will revenue and reserves rise (the higher the price the higher the profitable investment in extraction so the greater the reserves) so stock prices will too.

If on the other hand you think there is some price level above which the economy will not be able to function then you'd probably decide that even if production remains the same, reserves will fall and so will the valuation and stock price of the company.

Does that sound right or is it all about who's computer is closer to wall street? LOL

Anyway, welcome.

Very long term? Probaly not good. As oil is replaced be emerging technologies such as advance batteries and energy storage devcies the need for oil will slowly diminish. A technocopia of power advances await us, now the smart oil companies who invest in those technologies will do well.