Since the end of September, WTI and Brent oil prices have experienced one of the most violent and rapid sell-offs in history.
Over the short term, energy stocks typically follow commodity prices particularly on the downside. Thus, the S&P 500 Energy Index is off 19.6% this quarter, the Alerian MLP Index is down about 12.8%, the SPDR Oil & Gas ETF (NYSE: XOP) is down 34.8% and the Philadelphia Oil Services Index (OSX) has plummeted over 40% led on the downside by the deepwater and onshore contract drillers.
We continue to believe the macro picture for oil – rather than company-specific fundamentals and earnings prospects – has been the primary driver of downside for Energy & Income Advisor recommendations this quarter. Similarly, a stabilization and eventual rally in oil prices will ultimately prove the catalyst for a bottom in the group and subsequent recovery in prices.
In this issue we take a deep dive into the fundamentals of the oil market and our outlook for crude oil into early 2019.
Your complete guide to energy investing, from growth stocks to high-yielders.
In October 2012, renowned energy expert Elliott Gue launched the Energy & Income Advisor, a twice-monthly investment advisory that's dedicated to unearthing the most profitable opportunities in the sector, from growth stocks to high-yielding utilities, royalty trusts and master limited partnerships.
Elliott and Roger on Jul. 27, 2022