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Oil is produced by the privileged few in the world who is like a cartel. Investing in oil requires very good knowledge and also in-depth research.

Do short term only if you have the eye for it. To buy at low or prices when the rest of the investors are profit taking or selling for various reasons require the patience of a skillful hunter and a step wrong will blow you away. Everyday, we have different news that can move the oil prices a few dollars each way. The volatility is too much to stomach even for the best in the game. So do short term investing if you can stomach the risk and is a very sharp trader.

Long term investment is better for all. The direction is clear for all to see. Oil, being a precious commodity, will run out one day. Alternatives are not forthcoming, whether delibrately or not. Demand and supply will tell you that if a good is more scarce, the price will shoot up. So buy some oil related investments and hold it for a long term to come. The considerations are holding power, time and perhaps good substitutes to come. I feel the last factor is unlikely to happen. So if you have holding pwer and time to play and of course, money, buy oil now and hold it the way Warren Buffett will do to his holdings.

Learn more about this author, Cairns Faber.
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