Along with Repsol (PINK: REPYY) and Royal Dutch Shell (RDS-A), Occidental Petroleum (NYSE: OXY) is the latest major oil firm to put its assets up for sale in troubled areas of the world. Like Repsol, the Spanish oil giant, Occidental Petroleum is looking acquire more oil and natural gas assets in North America. According to an article in The Wall Street Journal, Repsol is looking to spend $5-10 billion on energy holdings in North America.
Investors should follow the lead of Occidental Petroleum, Repsol, and Royal Dutch Shell.
There are tremendous amounts of instability and political turmoil and many oil producing regions of the world. Royal Dutch Shell is selling blocks in Nigeria due to theft. Strife in the Middle East and North Africa has Occidental Petroleum looking to leave. It is likely that more will be selling assets in troubled areas around the globe.
After selling, it is also likely that North American oil and gas firms will be on the radar screen for investing.
That is already the stated intent of Repsol and Occidental Petroleum. That is understandable as firms operating in North America such as Suncor Energy (NYSE: SU), ConocoPhillips (NYSE: COP), Octagon 88 (OCTBB: OCTX), and Americas Petrogas (TSX: BOE) are doing well. Those operating in Canada such as Suncor Energy (NYSE: SU), Octagon (OCTBB: OCTX), and Americas Petrogas (TSX: BOE) are especially appealing.
It is the small cap firms such as Americas Petrogas and Octagon 88 that should be the most alluring to investors, though.
Major oil firms like Suncor Energy, ConocoPhillips, and others have all done well in the current bull market. Legendary investor Warren Buffett is a major shareholder of both ConocoPhillips and Suncor Energy, which always helps. The upside is probably limited in Big Oil, as a result.
For Octagon 88, Americas Petrogas, and other small cap firms, there is tremendous potential, however As a timely example, Octagon 88 is doing very well do to encouraging results about its holdings in Canada. Americas Petrogas just reported very strong results for the most recent quarter. For individual investors, that is very attractive.