If gas starts becoming scarce and prices skyrocket, what happens to oil company stock prices?

[Kablooie]

Will this drive them up or down?

[zonmoy]

1. up at least until civilization itself unravels.

[whistle]

2. Are you heavily invested in oil stock?

[Kablooie]

4. Unfortunately I inherited some a few months ago.

[A HERETIC I AM]

6. So sell them.

If it is Exxon Mobil, it still has a fair amount of upside room. Regardless if which company it is, if you recently inherited it, the cost basis is stepped up to the date of the decedents death. The higher it goes from now on, the more you will have as gains and the higher your tax bill. If it bothers you to hold oil company stocks, sell them and reinvest elsewhere.

My condolences on the death in the family, but you use the term "unfortunately". Well, that person thought enough of you to name you as a beneficiary. I would say that is rather nice and not at all unfortunate.

[Kablooie]

12. I inherited them from my mom who inherited them from her mom who inherited them from a rich friend.

My grandmother died a couple of months after she inherited the stock and my mom felt she had enough money for herself so didn't do a thing with them. She didn't even know what stocks she had.

One thing about holding the oil stocks is that I have a small voting share in the company and can participate in shareholder meetings. Having that small forum might be useful someday so I'll probably hold onto them.

Being a Prius driver myself, I would be happy if oil became much less important to our economy.

[TheFarseer]

3. up as long as the economy

is not affected in a obvious way. If the economy obviously collapses, then oil stocks will probably go down.

[Purveyor]

5. They will adjust their prices accordingly and pad a few extra cents just for good measure...

I laugh when some say countries such as iran/venezuela will suffer a loss should they choose to withhold some of their oil of the market.

OK, so Iran withholds 50% of its oil. Price before embargo $70. Price after embargo $100 and Iran takes a small hit on current incoming revenue, while preserve their reserve, and the 'free world' economy nose dives on this $100bbl oil.

Got us by the 'short-hairs' indeed. Why they haven't yanked on them yet?

OH...BTW (i veered off into a rant), your USA holdings will shine quite nicely, indeed~!

[A HERETIC I AM]

7. Do you think recovering, refining and distributing petroleum products will remain a profitable

business? As long as it is a profitable business and the companies involved in it make money, their stocks will continue to do well. When they no longer have a profitable product to sell, they wont, it's that simple.

[Palladin]

8. Oil companies with secure access

to resources in the First World (e.g., Canada, Wyomin', Colorado, North Sea, Alaska) will be doing very well. Russian state oil companies will be in good shape, but we in the former US cannot really invest there. Oil companies having to do business in more unsettled areas where there's no military or political control are going to plummet, along with the rest of the world economy.
Say Cheney and his neocon friends in America and Israel are successful in starting a war with Iran. Oil will probably go to $150-$200/barrel.
Exploration and development in the Middle East will come to a halt, and any company, even Halliburton, involved and invested with that area of the world will take a bath. China and Japan will not be pleased. Both have extensive trade and development contracts with Iran, and critical energy needs, and they might decide to unload the astronomical amounts of inflated US Treasuries they hold. The dollar is depreciating even now to historic lows versus foreign currencies in market anticipation of such developments. If this catastrophe comes about in this way, we'll know exactly whom to blame and hopefully, to bring to justice. The principal architects will be Cheney and his foreign and domestic neocons, and their courtier press, just as it was for Iraq War II in 2003.

[A HERETIC I AM]

13. If you think you can't invest in a Russian oil play, you would be wrong....

Look into Lukoil;

You can invest in ADR's of the Russian oil firm Lukoil quite easily. Ticker is "lukoy.pk"

http://quote.morningstar.com/Quote/Quote.aspx?ticker=LUKOY
http://finance.yahoo.com/q/ta?s=LUKOY.PK&t=5y&l=on&z=m&q=l&p=&a=&c=

Also, BP is a major player in the Caspian and both Exxon Mobil and Chevron are major stakeholders in several projects including pipelines.

There are also ETF's that have a global energy footprint as well as Equity ETF's that are Russia and Eastern Europe specific;

http://www.etfconnect.com/select/fundpages/global.asp?MFID=19666

[Hippo_Tron]

9. Insecurity = sell sell sell

[nadinbrzezinski]

10. read armed madhouse

they wish they can do that... prices will go up and STAY UP

[slampoet]

11. You ever see what happens to an airplane that soars to high of an angle too fast?

It stalls and plummets.


The exact same thing happened to railroad stock in the 1890's I think.