AM 1150 Kelowna - Radio Rallies & Reversals

On the topic of oil, I recently came across a transcript, featured by John Mauldin's 'Outside the Box', of an interview involving Marin Katusa, of Casey Research, and Dr. Marc Bustin, also of Casey Research, and one of North America's leading experts in unconventional oil and gas. They fear that as a result of the Deepwater Horizon disaster in the Gulf of Mexico, there may be a major shutdown in offshore exploration off the coasts of North America. In any case, costs for drilling both offshore and onshore are going up, and this favors the majors and low cost producers in general. In the short-run, profit margins will get squeezed, and this may help explain the recent sell-off in energy stocks in general since the Gulf incident, but longer-term they remain bullish on the space including the oil sands.

GB