Friday, November 23, 2007

An affordable chinese oil stock to consider?

Do you happen to know anybody who needs oil? You know to either fuel their car or heat their home? We all do and in china the number of people fitting this category is increasing at a pace never before seen by the world. That is what oil companies are for. They fill this need and make money doing it. There is a company in china called China North East Petroleum holdings (CNEH). They are engaged in extraction and production of crude oil in certain provinces in China. The company has an exploration area that is about 20 square kilometers. So far a little more than half of it has proved to be oil bearing.
In mid august of 2007 one share of stock in this company was going for about 50 Cents. Yes thats right just 50 cents. It had been steady at 50 cents for a while. Suddenly by october of 07 it had risen to about $4.50 a share. That is an 800% increase in two months. The stock has however dropped to around $2.35 by Thankgiving.
If your interested in getting involved in investing in oil stocks there are some things to consider. Chinese oil companies are mostly owned by the chinese government. Usually they own around 75% of it and the rest of it is investors. The chinese government is also involved in the extraction of oil from north Africa. Places like nigeria and Sudan. Sudan is the country where a genocide is currently taking place in a region known as darfur. There is a belief among some circles in the international community that the government of Sudan takes the money that it gets from the chinese oil revenue and uses it to buy arms in order to continue the genocide going on in its country. The government of Sudan denies this and the Chinese government is not really interested in looking into it to try and stop it because it does not want to jeopardize its access to all that oil that it needs to feed its ever growing economy. It basically considers the matter a Sudanese internal affair.

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