I’ve been holding oil ETF’s ever since they crashed during COVID (XLE and XOP), and while they sure bounced back nicely after COVID, they’ve remained nearly flat since ‘22 era despite all of the other headwinds that the industry has going for it. Between the massive production growth in the US (primarily from the permian), the incredibly low valuations, healthy dividends, massive growth in export capacity (especially in LNG), how renewables aren’t going to move the needle much, and that fact that oil is still essential in every day life, I’ve been waiting for XLE and XOP to hit much higher levels any day now….
Now that Hormuz is closed with long-term infrastructure damage, and no end in sight to the blockage, I firmly believe there’s no better broad sector ETF to be holding other than oil at the moment!
Question for me is – at what point does the investing world decide to join me in getting oil back to valuation levels it deserves to be? Is that when the physical shortages begin to hit, a few months after they’ve hit, after how many quarters of blockbuster earnings reports that make tech companies envious will everyone else jump in? What are your thoughts?
Any other oil investors out there thinking Hormuz might finally be your moment?
byu/Intrepid_Cup2765 ininvesting
Posted by Intrepid_Cup2765
7 Comments
We need to undo EVs.
i never had good luck with the big gains at once…its always been slow and steady consistency for me between a combination of index funds/etf, a good paying tech job, bonus and stock grants , and real estate appreciation and rental income.
It will take probably a few more years to reach my next goal of $10m net worth if possible at all.
So, no, I dont think anything significant will happen that accelerates my journey.
Already sold.
You picked the wrong oil investment. The money to be made has been in futures and it left you behind a month ago. Sure XLE and XOP are going to be profitable, but they’re not where the real money is being made right now – also don’t expect the market to chase oil alone. It’s chaotic and unpredictable.
Energy, in general, is a good investment though. To say renewables won’t move the needle is naive, at best. We need energy from everything and everywhere. Oil by itself isn’t going to cut it, neither is LNG. There’s also no mention of nuclear in your argument, which is a total mistake. You could be in companies that build the turbines that go into energy plants, invest in an oil field and get a massive tax credit, put some into energy storage, solar and nuclear and do quite well for years to come. But, my point is, the market doesn’t care about just oil even though the world does.
And… that’s just the energy sector. AI is also driving a lot of this which has it’s own investment thesis to consider.
Any concerns with what could play out now that UAE split from OPEC?
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im more interested in your plan to sell? you dont sound like you have any clear path to taking profits and will be left holding all this when at some point this conflict abruptly ends