After a short-lived rebound, oil stocks are giving up their gains - and I think I know why. Oil investors are beginning to consider what might happen to their portfolios if the price of oil doesn't recover.
BP (LSE: BP) (NYSE: BP.US) shareholders could do with a bit more good news, and they did get some on 16 January when the latest court ruling in the US potentially lowered its eventual oil-spill fine by around $4bn.
Its subsidiary BP Exploration and Production was involved in an oil spill in the Gulf of Mexico in 2010, and BP plc (ADR) (NYSE:BP) is currently facing trial charges regarding the oil spill in New Orleans.
With the falling price of oil seemingly having no end in sight, income seeking investors are understandably highly concerned about dividends at oil majors such as BP (LSE: BP) (NYSE: BP.US) and Shell (LSE: RDSB) (NYSE: RDS-B.US). That's because a ...