This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Dicker: I See Opportunity in Domestic E+P Companies on Oil Price Drop

NEW YORK (TheStreet) -- I was talking to Jim Cramer about the drop in domestic oil prices under $100. I believe this drop represents an opportunity.

Several separate incidents have conspired to drop WTI crude price in the last three days.

There's been a bond default in China, putting Chinese demand in doubt. On Wednesday the Energy Information Administration reported increasing stockpiles for the third straight week in the U.S. and there's been a moderation in the anxiety surrounding the Ukraine crisis.

Finally, a "test" of the Strategic Petroleum Reserve, adding five million barrels of sour crude to the market, began Wednesday. All have combined to push prices for oil here in the United States under $100.

But I told Jim I believe oil will not make a new low in 2014 and that Brent prices, which are the real-world benchmark for global oil, remain steady despite all of these pressures. With the many oil stocks in U.S. exploration and production companies reeling, I think we have an opportunity to buy some shares when they're moderately "on sale."

Must Read: Herbalife Investors Unmoved by Ackman's China Claims

If the charts hold, then WTI oil should not trade below $94 before finding an interim bottom, despite the free-falling trade of other commodities that China depends upon, including copper.

That makes companies like Anadarko Petroleum (APC), EOG Resources (EOG) and Noble Energy (NBL) relatively good value here.

I talk more with Jim about oil in the video above.

At the time of publication the author had a position APC and NBL.

This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

Dan Dicker has been a floor trader at the New York Mercantile Exchange with more than 25 years of oil trading experience. He is a licensed commodities trade adviser.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AAPL $109.50 0.00%
FB $92.47 0.00%
GOOG $639.16 0.00%
TSLA $226.72 0.00%
YHOO $32.37 0.00%


Chart of I:DJI
DOW 17,050.75 +138.46 0.82%
S&P 500 2,013.43 +15.91 0.80%
NASDAQ 4,810.7880 +19.6360 0.41%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs