The news this morning that a Mariner Energy
Seth Jayson, Motley Fool Hidden Gems: Tragic, again, and we don't know much, but I'm already wondering what the knee-jerk response will be. I suspect it will take some form of "let's have a longer drilling moratorium," which would raise some interesting questions for BP and the Obama administration. The president's men have tried to make the case that the costs of the government moratorium should be borne by BP, because it was the BP explosion that forced the government to make that decision. If you extend the moratorium based on this event, can you still expect BP to pay for it?
Should we be buying stocks in the oil patch today? That part of my portfolio is already filled out, but if it weren't, I'd probably hold off for a while, at least until I had a little better understanding of what public and policy response is likely to be, and how it might further dent firms working in the Gulf.
Tim Hanson, Motley Fool Global Gains: Geography is key. That's because while the market is likely to sour on the sector as a consequence of greater looming U.S. regulation (which I'll guess is all but assured now), drilling as usual will continue to go on around the world due to the nearly insatiable demand for energy in emerging markets such as China and India. Seadrill
Joe Magyer, Motley Fool Inside Value: It'll be a while before we have any concrete details on what has happened, though that won't stop the mainstream media (or us!) from pontificating. Fortunately, early news reports are indicating that only one person was injured in the incident. Whether this incident creates environmental or personal tragedy, though, it will undoubtedly draw more attention to the moratorium, the lost jobs associated with that, and the increased safety regulations hoisted onto drillers. While forcing more regulations and technical safety checks onto drillers is well-intentioned, those higher costs will ultimately be at least partially borne by consumers of oil and gasoline. So ... by you.
If there's a bright financial side to this, it could be that higher safety standards create a wave of rig and equipment upgrades from which the likes of National Oilwell Varco
Seth Jayson owns shares of Transocean, Hornbeck Offshore, and BP. Tim Hanson does not own shares of any company mentioned. Joe Magyer does not own shares of any company mentioned. National Oilwell Varco is a Motley Fool Stock Advisor selection. The Fool owns shares of ENSCO and Noble. Try any of our Foolish newsletter services free for 30 days.
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