Login

Tech Fueled Riches With This All-Purpose Oil Play

The U.S. is about to become the world’s No. 1 oil producer.

Two years ago making this claim would get you laughed out of the room.

Most thought U.S. oil production peaked decades ago.

Today U.S. oil output rivals the likes of Russia, Saudi Arabia, Venezuela and Iran.

Why?

Because advanced technologies have allowed companies to efficiently tap into an incredible surplus of oil located in the Permian Basin of the South Western U.S.

And as such, there’s plenty of tech powered gains to grab in big oil right now.

Why Big Tech Is Big Oil’s Best Benefactor

Here’s the tell all-fact behind my claim.

The Wall Street Journal reports: “The number of drilling rigs now active in the Permian is the same as back in October 2011, yet the region is producing three times as much crude.”

Additionally The Journal reports, Permian Basin output has surpassed a daily output of 3.1 million barrels. The output from this region alone ranks it as the No. 4 oil producer in the world.

All thanks to technology.

In the past, oil rigs were assembled to tap one oil well at a time. When that well went dry the rig would be disassembled and moved to the next drill site.

Now using advanced technologies drillers can set up one oil rig, and tap multiple oil wells at the same time.

The amount of time and money saved by this new type of oil rig is incredible.

Additionally, advanced AI powered mapping equipment allows drillers to find new oil wells with pinpoint accuracy.

Reducing costs without impacting production is the perfect recipe for profits for those with positions in U.S. oil.

A Trend That IS Your Friend

The resurgence of U.S. oil fueled by technology is not a flash in the pan occurrence. This trend will continue for years, maybe even decades.

And as such, its creating a number of great tech fueled gains in an area we rarely look to as tech folks.

The most straightforward way to tap into this tech trend powering U.S. oil to new highs is with Permian Basin Energy ETFs.

The one I want to talk about today is the PowerShares Dynamic Energy Sector Portfolio (NYSE: PXI)

PXI’s top holdings include Chevron (NYSE: CVX), Marathon Petroleum (NYSE: MPC), ConocoPhillips (NYSE: COP) and Occidental (NYSE: OXY), which combine for over 10% of the ETF’s weight, according to Nasdaq.

National Oilwell Varco (NYSE: NOV) and Phillips 66 (NYSE: PSX)  combine for another 5% of PXI’s weight.

And thanks to the advanced tech used by these companies in the Permian the ETF is filled with winners right now.

Here’s the stock chart for the majority of their top holdings over the past three months.

Source: StockCharts.com

And with PXI, you can tap into all these tech fueled gains right now.

The contrarians will argue that slumping oil prices, in light of increased production, will kill a lot of these futures gains.

The truth is this simply isn’t the case.

In fact, as The Wall Street Journal notes, due to advanced tech U.S. companies in the Permian Basin are operating at such high efficiency they can easily remain profitable if oil slumps to $40 a barrel or less.

Take that OPEC!

The bottom line is not every tech play is an obvious one. And not every tech win is with a semiconductor or FAANG stock.

If you dig a little deeper you can strike it rich with tech powered gains in the most unlikely places.

For Technology Profits Daily,

sean

Sean McCloskey
Managing Editor, Technology Profits Daily

Editor’s note: Keep the discussion going right now by joining our new Facebook group, Tech Talk With Ray Blanco.

It’s your first-class ticket to all things Ray. And IT’S FREE! Click here now to get added!

You May Also Be Interested In:

Sean McCloskey

Sean McCloskey is the managing editor of the Technology Profits Daily and Mike Burnick’s Wealth Watch e-letters. He has been with Seven Figure Publishing for two years.

View More By Sean McCloskey

LEARN TO TRADE LIKE A PRO WITH THE SEVEN FIGURE PODCAST!