Speculative flurry Momentum equity investors and options traders in recent months have begun to swarm all over oil stocks. Volatility has jumped. The enthusiasm is a sure sign the appeal has less to do with bargain values than with speculation that stock prices and earnings will continue to rocket. And investors shouldn't assume that all oil-related companies will boom like the service sector. Fidelity's energy-service fund has been a big winner precisely because it focuses on equipment and services.
Many analysts foresee a continued drilling boom ahead.
Fla. He expects the price of oil to fall as much as 25 percent. Big Oil and the many companies that service it emerged from the severe industry shake-out of the past decade well streamlined. The sector has cast off excess capacity and slashed inefficiencies across the board. New technology, especially three-dimensional seismic exploration equipment, is enabling drillers to tap profitably into abandoned wells and boost their success rate on new fields. Growing demand for oil Most important, many analysts believe strong global economic growth and rising demand will eventually push up the price of oil.