Why I think the current oil sector correction is an incredible buying opportunity

Undiscovered Equities, Inc. 1515 S Federal Hwy, Ste 207
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Why I think the current oil sector correction is an incredible buying opportunity

The fear and pessimism that has accompanied oil's correction is a classic (and from a contrarian viewpoint it’s a compelling) buy signal on its own.

One fear is that a slowdown in China might clobber oil consumption. For insight into this possibility we defer to Goldman Sachs. They predict a re-acceleration of China’s growth. Critically, China’s Central bank just said it has switched its priorities from fighting inflation to ensuring China’s 10+ percent economic growth continues. With most countries we might be skeptical. But China has both the need (a few 100 million poor that will not tolerate any postponement of economic growth) and the means (over a trillion dollars in surplus reserves.) We take its statement as a buy signal.

This is just one example of the growing list of reasons for consumption to remain strong and oil prices to soon rebound. But while many investors worry about falling oil prices the real story to watch is about falling oil supply. And now the world’s perennial supply optimists, the International Energy Administrations have finally started to come to grips with what is a dire situation. They have recently increased the global depletion rate from 4% to 5.2%. The translation is that nearly 4 million barrels per day of additional production must be developed per year just to keep oil supplies stable, never mind accommodate future consumption growth.

Consider that, according to the renowned McKinsey Global Institute, in the next 15 years China will have added more than 300 million people to its Urban population – that is car-driving, air conditioner-using energy consumers – that is more than the entire population of the United States. Consider that currently America consumes more than 20 million barrels of oil per day.

If this is the case, as the world struggles to keep up with exploding energy demand, higher oil prices and a renewed spectacular oil stock bull market (especially high growth junior oil stocks), are in my estimation a near certainty.

With this thought, I invite you to read my investment letter and would like to bring to your attention Manas Petroleum Corp. our number one oil growth story.

For more information, please contact us at 1-800-404-8982.

Very Truly Yours,

Kevin McKnight,
President
Undiscovered Equities,Inc. (My personal line is 1-800-404-8982)

www.undiscoveredequities.com

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