This week the big oil companies – Conoco, Chevron, and Exxon – will report earnings. Crude prices, which rose to $82 last week, fell as investors voiced doubts about the strength of the global economic recovery.
CNNMoney reports that in early trading, the market rose on surprise earnings news from Verizon.
Investors and traders are not only waiting for the big three earning announcements, but the Commerce Department is scheduled to announce third-quarter gross domestic product, with reports on housing prices, new home sales, consumer confidence and durable goods orders also due during the week.
But there’s something else that may shock the market. China is wrapping up negotiations to begin drilling for oil in U.S. territory. According to Qatar’s The Peninsula, “the state-owned China National Offshore Oil Corp, or CNOOC, reportedly is negotiating to purchase leases owned by Norway’s StatoilHydro in U.S. waters in the Gulf of Mexico.”
This is CNOOC’s second attempt to get a hold of U.S. oil assets. China is on a hunt for natural resources in an attempt’s to boost internal demand and continue its stellar growth path.
In fact, some analysts believe China is quickly overshadowing the U.S.’s global role. An article in the Baltimore Examiner says, “China has moved aggressively to fill a vacuum left by the United States in recent years, as the U.S. focused on wars in Afghanistan and Iraq and the global economic crisis sapped its economy.”
Both the U.S. and China consume large amounts of oil and both are actively exploring for new sources. In fact, Ghana has $5 billion in untapped oil reserves. China and the U.S. are vying for a stake in the project.
In fact, “BP, the oil group, is considering making a bid for one of Africa’s biggest offshore oilfields [the Jubilee field] in a move that could pitch it into a direct battle for control with Exxon Mobil, its arch U.S. rival,” reports The Times.
A bid by BP would seriously threaten Exxon’s hopes for a stake in the project valued at $4 billion. However, most analysts say Exxon’s contract in the project is an “exclusive” arrangement and would be enough to keep BP out of the oil field.
Putting new oil fields aside, market analyst Adam Lass, creator of the proprietary trading system WaveStrength Options Weekly, is recommending readers take a position in an energy company that’s stock price is read to rise. “Usually energy is a leading indicator. But these days it has been the last one to the party,” says Adam.
“But looking at the charts, oil has already broken out,” he explains. Because of that breakout, Adam uncovered an energy company that, when charted, shows a clear rising trend that could easily take share price up another 30% without even breaking out a sweat.
To learn more about this energy company and other opportunities with WaveStrength Options Weekly download Adam Lass’ Special Report.
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