This column was originally published on RealMoney on Feb. 21 at 2:21 p.m. EST. It's being republished as a bonus for TheStreet.com readers. For more information about subscribing to RealMoney, please click here.
Iran's running out of oil, or at least the oil that's easy to find. So's Iraq. India has oil that it wants to explore, but needs the rigs. So does Vietnam. Off the coast of Africa there's a lot of oil, but it won't be available to drill for a couple of years. That's not soon enough to meet the demands of a China or an India or, course, the totally profligate U.S.
And we believe that the oil cycle is over? We believe that the rigs won't be used and the day rates won't go higher? Does anyone see a giant rig build out there? Is it possible that the jack-up rigs will be in too much supply?
I don't care. This group has the potential to be a multi-year group. I don't see any sign of rates going anywhere but up, except in Canada, where the problem is structural -- the government wrecked that business, and the Gulf, where there just isn't enough oil or the incentives to go for it.
No matter. The Street hates the group. It believes in farming, not drilling. It likes the new "oil service" companies --
-- not the old ones.
Let me make an analogy for you.
is a terrible company that keeps missing numbers. And it keeps going to 52-week highs.
is a fabulous company that keeps beating numbers.
Transocean can't get out of its own way. Agco, what a ramp.
Oh, and need I even mention
This group is on show-me status. It is a cyclical group that is poised to follow the likes of a
People just don't know it yet.
So take advantage of the fact that the easy oil's been found, the demand is high and the rates are generating so much cash it's incredible.
A great place to be.
At the time of publication, Cramer was long Transocean and Halliburton.
Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. Outside contributing columnists for TheStreet.com and RealMoney.com, including Cramer, may, from time to time, write about stocks in which they have a position. In such cases, appropriate disclosure is made. To see his personal portfolio and find out what trades Cramer will make before he makes them, sign up for
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