Wondering What You Can Buy? Check the Oils

Yes, I do not believe you can advance with the nationalization issue on the table. Once again, the issue is not the common stock. You can dilute the common stock to almost nothing -- just look at AIG (AIG - commentary - Cramer's Take). That's fine. But if you wipe out the preferreds and the bonds, though, you know I believe the stock market will simply evaporate. That's how critical it is. I think that we could be down several thousand points on the wrong move.

But if we don't get that draconian measure of wiping out the residual securities for the banks, I believe we can go higher. What would go up? Oil and oil-related. We have hit two key levels in oil: stronger demand and weaker supply. You have been paying more for gasoline because of demand. The Chinese are investing huge to buy enough oil, with that Petrobras (PBR - commentary - Cramer's Take) deal. Meanwhile, as you can tell from Schlumberger (SLB - commentary - Cramer's Take), you are seeing a true cessation in drilling worldwide. Yes, Transocean (RIG - commentary - Cramer's Take) is talking about longer projects not being canceled. There's a lot of investment that can't be walked away from here.

That means, with increasing demand and declining supply, you can own the integrateds. The two downgrades of Exxon (XOM - commentary - Cramer's Take) yesterday were about this thesis. The analysts didn't downgrade Exxon because of weakness in crude, they are upgrading the other oils because they expect a run back up in crude, maybe to the $50 level.

I like Exxon the least, but oil is the best neighborhood so I am not a seller. But BP (BP - commentary - Cramer's Take), Chevron (CVX - commentary - Cramer's Take), ConocoPhillips (COP - commentary - Cramer's Take)?

These are the stocks to buy into this weakness. Right here. Right now. They will work: low valuations, high dividends, worldwide demand.

They work.

Random musings: I agree with Rick Santelli on something -- the last few Buffett trades have not been good!

At the time of publication, Cramer was long BP, Chevron and ConocoPhillips.

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