With crude oil prices at an 18-month high earlier this year, and overall sentiment for oil stocks turning higher, our very own petroleum engineer and oil & gas expert warned BNL Members not to get trapped into believing these were stocks to buy. He explained in mid-January that nothing in the oil & gas space was a buy at that moment, but long-term, Halliburton Company (NYSE:HAL) would prove to be the best, as would HAL stock when the market recovered. Here are a few other things our petroleum engineer said four months ago:
- Nat gas prices had peaked at $3.40, and would not see sustainable pricing above $3.50. Today, nat gas prices are still right at $3.40.
- Oil stocks would fall
- Oil prices had peaked for the time being near $55. Crude is now under $48.
- Halliburton, Schlumberger, & Pioneer Natural Resources are top plays, but not yet stocks to buy. HAL stock is down roughly 20% since that January article.
With these things considered, and given how oil stocks have fallen, I asked if Halliburton Company (NYSE:HAL) was a better investment than Baker Hughes Incorporated (NYSE:BHI). Furthermore, I asked if HAL stock is now a good investment after its 20% decline.
Is HAL stock a good buy, and better than Baker Hughes?
The following comments were made by our petroleum engineer, who is a BNL Member, in the member Live Chat section of members only. It has been edited for readability and syntax.
I hope we stay out of oil stocks for a while. We may get a nice pop here and there, but long term gains have not kicked in.
Halliburton and Baker Hughes were the two major service companies in my basin. Baker Hughes Incorporated (NYSE:BHI) shut down their offices and left. Laid off about 250 people. Great hands, with a lot of experience and knowledge. Halliburton Company (NYSE:HAL) did too during the down turn, but did not shut down their offices. Now they have put together a 3-4 frac crew in my area. So I am thinking Halliburton Company (NYSE:HAL) has a better business outlook/plan now vs Baker Hughes Incorporated (NYSE:BHI). I don’t know what they (Baker Hughes) are thinking, let go of an entire basin’s operations after building a customer base and trust over the years?