“Gas prices are high!”
That is the most obvious statement of the year.
Where are the oil barons when you need them?
Well, if the oil barons aren’t going to do anything to lower the cost of gas, the White House staff says they will try.
And just in time for the Thanksgiving holiday road trip!
On Tuesday, the Biden Administration announced that the U.S. would be joining with other nations by tapping the nation’s strategic petroleum reserve.
The U.S., China, India, Japan, South Korea, and the U.K., are hoping to form an OPEC-like partnership to help lower gas prices, which, as of this writing, are averaging $3.40 per gallon.
The group of nation’s plans on releasing 60 million barrels from their reserves.
However, don’t get too excited!
Unfortunately, even if the plan works, the increased supply won’t lower gas prices this week, so you may still need to carpool to the family Thanksgiving meal.
Gas prices remain high; however, a barrel of oil has seen a slight decline this month after peaking around $85 per barrel in October.
So, what exactly is the U.S. Strategic Petroleum Reserve?
The U.S.’s Petroleum Reserve holds more than 600 million barrels in four underground storage caverns contained within salt domes along the Texas and Louisiana coasts.
According to the Wall Street Journal, “Congress authorized its creation in 1975, in the wake of the Arab oil embargo, as a buffer against supply shocks from oil exporters, but energy markets have changed dramatically in recent years.”
Although the market may not be acting swimmingly currently, there is one stock on which we remain “bullish.”
Our Green Zone rating system lists Chevron Corporation as “bullish,” which means we expect Chevron to outperform the market by 2x over the next 12 months.
It is in the Green Zone, which means we believe it is worth purchasing…if you so choose.
Chevron currently has an earnings per share of $5.17, a market cap of $224. 59 billion, and a dividend of 4.71%. It’s also a value stock, which means that low-valuation stocks tend to outperform high-valuation stocks.
Unless you have your own strategic oil reserve in your backyard, you might want to consider buying stock in Chevron.
And if you do have your own oil reserve, could you please share it with the rest of us?
That would be a nice thing to do.
Hey, it is Thanksgiving after all!