Are Oil ETF Profits A Sure Thing Over the Long Term?

It seems as though a well researched oil and/or natural gas ETF would serve one's portfolio very well as a long-term investment. Am I missing something with this?

NJ Gold
I think you are on the right track. The trend has been up and the trend is your friend. Oil should continue to see demand from thirsty China, India, the United States and other growing countries. Most of the easy oil that is land drilled has already been found, leaving most of the reserves in the harsh offshore environments.

By sticking with an oil ETF or a basket of premium quality mid-cap oil and natural gas company stocks, it seems to me one can't go wrong.

Joe
I think oil stocks will do well. But be careful. They are not a "GIMME." Back in 2000, everyone knew that the Internet was the wave of the future. Everyone knew that Internet stocks were a "GIMME;" they had gone up like crazy the previous few years. Unfortunately they had been bid up too high, and were in a bubble. Instead of going up more, they crashed. There have been many bubbles like this in the past. Oftentimes, the glamorous stocks get overpriced in bubbles.

Similarly, many people now think oil stocks are the wave of the future, and have bid these stocks up very high. They too look bubbly. Its hard to be sure how they will go in the future. They may continue to rise, or may crash like the Internet stocks. I would recommend putting part of your money in oil stocks, but diversify and put most of your money elsewhere. The stock market is highly unpredictable. Diversify.

dustoff
Nothing is a "gimme" in the stock market, but oil companies will probably do well. But don't make the mistake of assuming that their profits directly track with the price of crude oil - transportation, refining, political issues all are high-cost items for the companies.