After recession markets opted to invest in oil and gas sector

The recession shook the world and took everyone by surprise. Many people lost their jobs, a few even lost their houses. It looked as if the world was suffocating and finding it difficult to breathe. The stock market was down and the investors had taken a huge loss. While many were recovering from the loss, few investors were still interested in finding a way to invest and increase their money. Those interested found a way and noticed that commodities were only a little affected by the recession, including oil and natural gas. These two commodities are used by man every day and are a necessity in this economy. So many decided that to invest in oil and gas was a good option.

After food, clothing, and shelter, oil and natural gas are the other two essential commodities required by anyone to survive. Investors have now realized that it is much wiser to opt for oil and gas investments rather than investing in the stock market. Oil and gas investments are indeed a better option than equity shares. The oil and gas investments are better because oil and natural gas is daily commodity product. From driving a car to cooking food, oil and gas both are equally required.

There are many ways to make oil and gas investments. One of the ways of investing in oil and gas is making an investment in the shares of a company listed on the stock exchange. One can contact their broker and decide where to make an investment. The other way of making an investment in the oil and natural gas sector is by investing directly in the company involved. The direct investment is one in which the investment is made in the drilling of oil wells directly. The drilling of an oil well and the necessary research work behind it requires a lot of money and thus one can fund the companies at this point.

Direct investment is risky: if the well doesn’t bring in the estimated results, it might be a huge loss. The drilling of oil wells also require a lot of money, so many companies and individuals pool the money together to invest in oil directly. Even though direct investment is much riskier than indirect investment, there is an old saying that risk is the reward for return. The higher the risk, the higher is the reward, but if one is unlucky there may be a huge loss. Risk is always involved in investments, so if the chances of getting a huge return are higher in oil and gas investments, than why does one invest in other commodities? Thus, everyone should consider investing a certain amount in oil and gas sector.

- Chris Termeer

Chris Termeer

Chris Termeer is an oil and gas consultant, industry commentator and analyst. His book, Fundamentals of Investing in Oil and Gas provides a comprehensive overview of all aspects of the oil and gas industry, including exploration, drilling, production, storage, transportation and refining, to name but a few.

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