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Oil Market’s Dumpster Fire Claims New Casualty

Black Times for Black Gold

To say that energy stocks have given investors a bumpy ride over the last few years would be major understatement.

And just when things were starting to look good for oil this year, the floor gave way…

As you may know, after two years of record-high oil production intended to force out U.S. shale drillers, OPEC agreed to decrease their efforts last November — hoping to boost the flagging price.

But the opposite actually occurred…

On rising U.S. production and stubbornly high inventory levels, front-month crude has fallen 15% since the start of the year — and right into a fresh bear market.

In fact, this is the sixth bear market for oil in the last four years.

And as a result, energy stocks have taken a nose dive in the last month.

But as my colleague Louis pointed out last week, unless you’ve got an iron stomach, loading up on oil names now isn’t the best move.

Yes, many of these stocks are cheap relative to the broader market. However, barring a major event overseas that disrupts production, oil will likely hover between $40 and $60 for the next several years.

True, oil producers have gotten more efficient about getting...