Dividends and Crude oil prices slide deeper into bear market

In mid November, oil prices were decreasing rather than going towards the expected $100 per barrel they dropped below the $70 a barrel for the first time since April. In an article written by Reuters investors are worried about a slowdown in the economy.

The US, Russia and Saudi Arabia have produced near record high at 33 million barrels per day or a third of the world’s oil. US energy firms have 886 rigs working, the highest level since March 2015.

Iranian oil is going to South Korea and China, partly because Washington gave exemptions to Iran’s biggest buyers. The sanctions are not cutting supply.

Linking to dividend paying stocks, oil plays an important role in our economy, but when the price gets too high institutions examine more ways to conserve their resources or use less. When the price falls, there is less need. For those readers who work in office buildings or have a house, did you see the company making changes or did you insulate your house better? Most of us are price sensitive to oil but the large oil companies have access to oil at low prices which makes them a good investment and the dividends can help pay for the oil prices at the pump.

There are more questions than answers, till the next time – to raising questions.

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