We’ve received a few questions about what impact Hurricane Harvey may have on oil and natural gas prices. My answer: Not enough to change the uptrend forecast by our cycles.
Sure, refining capacity had been shut in and pipelines closed, sending gasoline prices through the roof. And that is likely to lead to a short-term inventory build for crude oil and natural gas, but that won’t last.
Look, it’s been almost one-week since Harvey made landfall; a direct hit on the U.S. energy industry, and oil prices dipped about 3% lower. That’s it.
The truth is, oil inventories have been steadily falling, including a decline of 5.4 million barrels last week, according to the latest data out just yesterday. That’s the lowest level of crude inventories since January 2016.
Plus, our E-Wave cycle forecast (chart above) indicates a turn date to the upside right now, followed by a rally straight through September, which is also a seasonally strong period for oil prices.
Now here’s another cycle forecast (chart below), but this one is for energy stocks as measured by the SPDR Select Sector Energy ETF (XLE) …
You can expect energy stocks to follow oil prices higher in lockstep over the next month, and it could be a sizeable move.
The best way to profit from it: Add the ProShares Ultra Oil & Gas ETF (DIG) to your portfolio now. This ETF is designed to hand you $2 of profit potential for every $1 gain in energy sector shares!
Here’s what to do right away:
Using 5% of the funds you have allocated to this service, BUY the ProShares Ultra Oil & Gas ETF, symbol DIG, at $29.90 or better. This order is good-till-canceled.
Get this order in to your broker right away and we will be monitoring a mental stop on DIG for you. Meanwhile, hold all other positions and stay alert for more updates and analysis.
Good investing,
Mike and David
