The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.
NEW YORK ( Trefis) -- Crude oil is arguably the most important commodity in the world today. All eyes are on crude oil prices and oil's dynamics because no country can satisfy its domestic oil demand independently and because countries rely heavily on oil for industrial and retail uses.
According to the International Energy Agency, at present price levels, the world's oil import bill could reach as high as $2 trillion in 2012, which would be near 3.3% of global GDP of almost $60 trillion. Let's look at how inflated oil prices can impact some of the oil-and-gas and energy companies like Chesapeake Energy (CHK), Exxon Mobil (XOM), Baker Hughes (BHI) and Halliburton (HAL).
Oil and Gas Production CompaniesFor oil and gas companies like Exxon Mobil, this environment creates opportunities to ramp up the production and try to satisfy the domestic U.S. demand and grow exports. We believe that the average oil prices and production volumes will be impacted. Below is the realized sales price for oil and natural gas liquids for Exxon which you can modify to see the impact on its estimated fair value.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV