For Investors Only

Trading at 52-week highs on Thursday during the week Iraq fell: APA, BP, Baytex, CLR, CP, CHK, COP, CPG, DVN, EOG, ECA, HAL, HK, HES, MRO, MPO, OXY, PXD, SN, SLB, WLL.

Economy: Reuters is reporting:

U.S. business inventories recorded their biggest increase in six months in April and picked up excluding automobiles, supporting expectations of a sharp rebound in growth in the second quarter. [Comment: I honestly don't get it, and the comments at the linked site suggest the same. I don't see how rising inventories are a sign of an improving economy. It makes sense that rising inventories improve the GDP if the rising inventories are in anticipation of rising sales, but if inventories simply build up in warehouses -- well, the good news: inflation will stay down.]

Early morning trading. Let's see what the oil companies are doing as oil starts to spike --

• XOM: up almost 1%
• COP: up over 1%; trading at a new 52-week high
• CVX: up a bit
• CHK: up over 2.5%; trading at a new high
• CLR: up over 1.5%; trading at a new high; and this is on top of some big gains earlier
• WLL: up over 1.6%; trading at a new high; and this is on top of a new high yesterday
• OAS: up 2.5%
• KOG: up over 2.6%
• HES: up over 1%; at a new high
• SD: up almost 3%
• TPLM: down about a percent
• UNP: down a buck
• GDP: up over 3% (only because it's in the news; I really don't follow GDP)

Disclaimer: this is not an investment site; do not make any investment decisions based on what you read here or what you think you may have read here.

Short term: oil company shares may surge in early trading, but could pull back significantly if they follow the general market which is currently trending down. Some folks may start locking in their profits. Shorts are going to be squeezed "big time."

The Bakken companies may or may not do all that well with the surge in oil prices because many of them are hedged. If they can't get to market what they promise to bring to market, they have to buy oil on the spot market and right now it's very, very expensive. The majors won't have that problem. Mineral owners will do well regardless.

The best news for oil bulls: yesterday $105.30 was the ceiling for "speculators." We've broken through that ceiling. Today will determine the "new norm" or the new trading range for oil. The longer the drama in Iraq lasts and/or if Baghdad falls to Syria/Iran/ISIS/Russia, the price of oil will continue to move up. Without North American shale, the price would have surged by now; the "Bakken success" has helped minimize volatility in the price of oil. Had the Keystone XL North been in place that would have been even better for US energy security, but that's water under the bridge.

By the way, this is surprising: the market is down (except for energy) and TGT is up. The company, yesterday, announced it is increasing its dividend by 21%.