We Predict that Oil Will Soar in 2010... Hitting $185 per Barrel

2010-04-20T19:46:00.000-07:00

Enjoy oil now while it's cheap, because it will cost twice as much next year.

We predict that Israel will launch an airstrike in 2010 against Iran's uranium-enrichment plant buried under a mountain range 100 miles southwest of Tehran. Iran will retaliate by showering missiles on Tel Aviv and will blockade the Strait of Hormuz.

Oil prices will soar to $185 per barrel in the panic.

Even if Israel doesn't attack Iran, oil prices are under serious pressure. Declines in production, exploration and the dollar will drive oil prices substantially higher in the years ahead.
All the easy oil has been found... big strikes are now extremely rare... and two major oil exporters -- Indonesia and China -- now import the stuff.

Meanwhile, the world's largest fields are all declining... from the Persian Gulf, to the North Sea, to the Gulf of Mexico, to Alaska.

OPEC is shutting off the spigot. OPEC has cut production by 12% of its capacity -- dramatically reducing the amount of oil coming to market.

Plus the dollar is weakening... and crude oil thrives on a weak dollar. When it doubled from July 2007 to July 2008, soaring from $74 to $147 a barrel, a major catalyst was the rapid decline of the dollar.

Global energy exploration is off sharply and future supplies are already jeopardized. When oil dropped after its 2008 surge, expensive energy projects like oil sands were put on hold. Oil drilling activity dropped 43%, with year-over-year oil exploration in the United States alone down 38%. Bids for offshore drilling rights in the Gulf of Mexico dropped by 80%.

Bottom line: With a weak dollar and reduced production bolstering oil prices, we'll see a dramatic spike in crude oil as the world economy picks up. And if war breaks out in the Mideast, as we think it will, all bets are off.

The best way to profit? In the stocks of a few large integrated oil companies that are trading at bargain prices.

In Hottest Investment Opportunities for 2010, you'll find two oil giants currently trading at multi-year lows. These companies have more cash in the bank than debt on their books. What's more, they are steadily increasing their dividends.

These companies can continue to post profits even if oil and natural gas prices drop. They have multiple profit centers and their refining and marketing profits will expand if spot prices decline.
A third favorite is an offshore deep-driller that recently made the world's largest oil discovery in 32 years. It is doubly attractive as a foreign company because it will get an additional boost as the dollar slides.

Predictions-2012

We Predict that Oil Will Soar in 2010... Hitting $185 per Barrel