Markets
DBO

Will the Oil and Materials Stocks Rout End in 2016?

Market data chart with calculator

We have seen the oil and materials stocks get killed by the Saudis. Think of it from their perspective. They think they have a great ally in the USA. Then, the USA makes a deal with the Iranians. Oil will flow from Iran now, and the USA is production shale oil using new technologies. Then, the Arab Spring creates democratic calls across the Arab Muslim world. Again, the old kingdom of Saudi Arabia is challenged. When a regime is challenged in multiple ways, the fear about losing relevance rises and rises. What should they do? Show this 'new world' of the USA, Iran, ISIL, and the rest that the old kingdom of Saudi Arabia is still relevant by building up market share inside OPEC and in the world. They stay relevant.

When does oil prices rise? When the kingdom of Saudi Arabia fells comfortable and in control again.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

US-OIL FUND LP (USO): ETF Research Reports

IPATH-GS CRUDE (OIL): ETF Research Reports

PWRSH-DB OIL FD (DBO): ETF Research Reports

To read this article on Zacks.com click here.

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

In This Story

DBO OIL USO

Other Topics

Stocks

Latest Markets Videos

    Zacks

    Zacks is the leading investment research firm focusing on stock research, analysis and recommendations. In 1978, our founder discovered the power of earnings estimate revisions to enable profitable investment decisions. Today, that discovery is still the heart of the Zacks Rank. A wealth of resources for individual investors is available at www.zacks.com.

    Learn More