Pros and Cons of Oil and Gas Investment

Published on: 27 December 2018 Last Updated on: 31 October 2024

Gas and oil are commodities that will always be in demand globally. No matter where you are in the world, people seem to be needing oil and gas more and more, be it for transportation, to run businesses and factories, and machines, and to do daily tasks such as cooking. Because of its increasing demand, it’s a highly favored investment choice by business owners and investors around the world. However, as with all other industries, the petroleum industry does have its pros and cons. Here are some of them:

The Pros:

1. There Are Tax Benefits And Advantages:

Naturally, economists and the respective governments encourage investors to put their money in the energy and petroleum industry. The more businesses in the energy sector, the higher the demand for this commodity, as the price per barrel of oil also tends to stabilize more. Remember this is important as almost all aspects of man’s daily life are highly dependent on the energy and petroleum industry.

To encourage investors to stay attracted to gas and oil businesses, governments provide for annual tax benefits and deductions. Some of these include the following:

When you invest in a limited liability partnership/gas company, such as the CEFM Oil & Gas Investment Fund, 15% of your share can become a part of your tax-sheltered income, which means that this 15% of your total stock will not be subject to taxes.
In the event of stock depletion, governments can allow for certain allowances to keep your company’s cash flow reports stable.

2. The Gas and Oil Industry Is a Lucrative Trade:

Gas and oil are both commodities. You cannot go through your daily life without either of these two. Even the simplest and most rural forms of living require gas, such as lighting up gas lamps at night. At present, the petroleum industry makes up 10% of the total gross domestic product of the world, representing an amount of around $10 trillion. This figure does not end here, as it is bound to grow even more as the global population increases in number.

3. The Rate of Return on Investment Is High:

Economists around the world found that the return on investment from oil and gas companies is usually around 5 to 10 times more than the capital that you put in. It is tough to find any other investment opportunity that allows for the same favorable returns. When exploration of an oil reserve starts, profit can begin to accumulate after the first two months; this speed is unrivaled by any other business sector.

The Cons:

1. There Is a Limit to Growth:

Oil and gas reserves are not taken from a renewable source. Eventually, the time will come when these resources will be fully depleted. As the demand for oil continually increases by the day, so does the rate of these reserves eventually being maximized and fully depleted. You can only do so much.

Further, this industry needs to fulfill a lot of environmental responsibilities, such as the rehabilitation of the reserve that was drilled up for oil explorations. Doing this entails costs for the company.

2. There Is a Huge Political Risk Involved

Because oil is a commodity, it is but natural that political governments intervene. As much as they would want to protect a private company’s interests to make sure investors in the market will stay, they are also protecting their political interests. Therefore, any change in trade factors concerning political state agreements, tax reform laws, treaties, and the like will significantly affect the price and stability of the oil. This would mean that you cannot ever shy away from any involvement of politics in your business if you decide to invest in the petroleum industry.

3. The Market Price of Oil Is Always Fluctuating:

As more and more individuals demand gas and oil, its market price will continue to fluctuate as well. Increased demand for goods will increase the supply; hence, the competition is high, so the costs have to decrease. This economic fact is good for the consumers but bad for you as the business owner. Profit is always what you have in mind, and in the oil industry, there is a ceiling as to how much you can increase the price of gas and oil.

Conclusion:

As lucrative as the oil and gas trade may be, do remember this list of its pros and cons. The disadvantages are not to discourage you from investing in this business sector, but it will help you make a better and wiser decision on where to plant your hard-earned money. Anchoring your investment in an informed decision will help you earn better growth on your commodity investment plan.

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7 Ways to Plan a Smooth Business Succession

Business Succession planning is one of the important levels of strategic planning that gives you an opportunity to formulate a plan on how your business is expected to perform after your tenure in leadership. Business Succession can make things more effective and wise in all aspects. Effective succession planning is highly advantageous as it gives you an opportunity to set in place mechanisms that ensure operational efficiency and transfer of leadership where necessary. When undertaking succession planning, emphasis should be put on ensuring that every aspect of business leadership is handled as comprehensively as possible. Whereas business owners understand the importance of performing succession planning, few put in place the necessary measures. Here are 7 key tips to consider when planning for smooth business succession. Initiate the planning process early: To be thorough and comprehensive in your succession planning, you need to ensure that you start planning as early as possible. Whereas experts do not have a recommendation on the definite duration of time by when you should start succession planning before implementation, it is generally agreed upon that early planning gives you sufficient time to come up with a comprehensive plan. Starting as early as 10 years before effecting the plan gives you sufficient time to ensure that everyone who is involved is sufficiently prepared to take over. This also eliminates the rush that may set in in the event of a delayed succession planning process. Such delays may lead to unprecedented and unwanted hurried succession which puts the business’s future in jeopardy. Nurture the prospected leaders: When undertaking succession planning, especially in a family business, emphasis should be made on nurturing continuity in leadership. This ensures that once you leave as the top manager, your junior takes your place and steers the company forward. When performing succession planning, you should have that in mind and therefore focus on nurturing and developing the prospective leaders. Leader development and nurturing should focus on, among other things, bringing the best out of the qualities you desire to see in them. This may be done in a gradual process such as delegating responsibilities and evaluating the prospected leader's ability to perform with the integrity and precision demanded for in a top business manager. Have an open-minded approach: To be thorough and effective in succession planning, you need to avoid bias as much as possible. In a family business or a business where leadership succession is hierarchical, maintaining an open mind can be quite hard, especially since the second in command is the most likely person to inherit your leadership. To avoid such bias, you should have an open mind in regards to potential candidates who can take over from you after you leave office. When looking for an appropriate leader to take after you, you may want to give a thought of every potential candidate available within the business. This gives you an opportunity to extend your options as wide as possible. It also ensures that you don't miss potential employees whose skills, competencies, and experiences may come in handy in taking over from you. Exposed potential candidates to training: Training is quite crucial as it ensures that prospecting leaders within your business get an opportunity to advance their skills. In this regard, leaders that you think are capable of leading your organization in one way or another should be appropriately identified and marked for progressive training and development. Such training should be focused on anticipated areas within your business that are of importance for the employees to take over once you leave. Succession training is also crucial and should be exposed to all workers who show an outstanding level of managerial skills. The well-trained workers get to be prepared for advanced leadership positions that may be created after you leave office. In some cases, promoting your immediate deputy in the hierarchy leads to vacant positions down the business administration structure. The well-trained candidates, once promoted, would be able to fill those positions effectively. Dry-run your plan: When planning for a smooth succession in your business, it is highly advisable to ensure that you, on several occasions, do a dry run of your succession plan. Dry running a succession plan gives you an opportunity to evaluate how potent your plan is in terms of meeting certain expectations. The dry running process does not have to be official and should be preferably done without informing the employees involved. This can be done by momentarily leaving your office for official vacation or even other official duties for a considerable amount of time such as between a few weeks to a month. The duration of absence gives you an opportunity to test how suited your prospected leaders are in terms of filling the void created by your absence. Do your final plan in writing: After concluding and making adjustments on your succession plan for your business, you should endeavor to put the final plan in writing. To be effective and thorough, you should consider engaging qualified, experienced, and reputable succession planning legal professionals such as Boss Lawyers in Australia. The lawyers, in such a case, help you to prepare the necessary documents including succession policies, how the current generation of employees will hand over to future generations, as well as how to resolve any arising disputes thereof. The exit strategy created from a legal perspective ensures that everyone within the business is bound while also creating a viable atmosphere for business continuity and harmony among the workers. Make your wishes known: Lastly, after every element of business succession planning has been conducted, it is crucial to bring everyone on board the plan to ensure that they are well aware of the strategic direction that the business is taking. You should, preferably, convene a meeting with everyone in the business as well as your business’s key customers. In the business meeting, you should outline what your wish is and reveal any other pertinent information that was not captured within the succession legal framework. You may also use the platform to ensure that any questions or concerns that your workers may have are appropriately handled in a plenary session. Read Also: Six Pointers To Starting A Successful Business How Does Modern Technology Propel The Success Of Your Business? Information Technology And Business Success: The Things That Connect Them Joel Devidal, CEO Of SMEJapan.Com Weighs In On Building An Online Business: 7 Steps To Success

4 Business Leadership Skills for Business Success

Nowadays having a business is very common. Every third person is into the business field and is trying and working the day-night oil to get successful. Some of them achieve success while others are unable to do so. The main reason behind the success and failure of any business depends upon the leader. Only a person with great leadership potential can lead a business to success. When you are into business and moreover you own a business or are a leader of your team then you need to follow some genuine and universal steps to get your business straight to sky-high. Only great leaders are able to achieve a successful business and to do so or become a great leader is not so tough if you are seriously into it. Leadership Skills for Business Success Now a question arises how to become a true leader who can guide his team to the doors of success. To be true it is a very simple question which can be answered as follows. To become a good leader one needs to have 1. Adaptability: It is one of the common skills a great business leader should have. If you are able to adapt to any type of tough or easy situation and come to a conclusion easily then you are one step closer to having business leadership skills. An only true leader is able to adapt and tackle the challenges in front of him with a solid plan of action. 2. People skills: It is one of the usual skills to be found in a leader. If you are not a person who has skills in talking to people and convincing them for your own then you can never be a perfect leader. Moreover, it also includes the ability to observe people, the ability to communicate effectively, the ability to motivate, and adaptability. 3. Self Awareness: If you are not self-aware then you are into a big problem. One needs to know his weaknesses and try to improve them. For example, if you are not able to justify yourself properly then you need to learn how to easily pass on the information which will be easily understandable by all. 4. Sense of purpose: It all depends on the vision you have in your mind and how you work on it to make it work in real life. It includes the skull which is necessary for every good leader to make his business grow and achieve success. These were some common skills that make a person equipped with leadership potential and these are the sole people who become a good and successful businessman. Having a hand in business is not all about luck it is all about how you try to handle every situation. It's all about how you use the opportunities you get and how you win the heart of your team. In order to become a successful business leader, it’s always advisable that you should take inspiration from any successful Business leader. Charles Field Marsham is a well-known name in the field of business leadership. Charles Field Marsham is a Canadian entrepreneur with more than 20 years of experience in building businesses. So if you are into business or stepping into the field of business then do try the above tips and feel success running towards you. Read Also: Components Of A Successful Business Function It’s All In Your Head: Do You Have The Right Mindset For Business?

13 Things To Consider When Choosing Fonts For Sales Posts

So you're writing a sales post, or want to? You've likely already considered the content of your article, but have you considered the fonts you choose to use? You can use beyond infinity font to create very good-looking designs for your projects. If not, here are some points that might help. 1) Make Sure They're Readable This is pretty self-explanatory, and I think we're all familiar with the idea. Nobody wants to read huge blocks of text that they can't even distinguish between letters, much fewer words, and sentences. 2) Be Careful About Using Too Many Fonts, Or Really Big Ones If you've got a whole different font in every paragraph (or worse: every sentence), it's going to be a headache for your reader. It's also going to look a bit ridiculous, especially if the fonts don't fit together prettily. 3) Stick With Popular Ones You may think having an artistic license to use whatever font you like is cool, but just remember that most people will want something accessible and easy to read. As a general rule, opt for ones you'd see in a novel or news site over the kinds you'd find in a video game or comic book. 4) Fonts That Fit Together Well Look Good This is one of the most important things to consider, and it may require a bit of experimenting. There are plenty of resources out there if you want to get started with choosing text fonts. 5) Serif Vs. Sans-Serif Fonts Can Be Tricky But Can Also Add A Stylish Flair Yes, there's no such thing as 'wrong' when it comes to using fonts (except maybe the ones I've mentioned in point 3), and you can get creative with this area of your posts too! One way is to go with serif or sans-serif fonts for your entire post, but another way is to mix the two, perhaps by using a serif font for larger titles and sans-serif for smaller ones. 6) Keep In Mind That Some Might Not Be Able To Read Certain Fonts This isn't something that I've personally experienced, but some folks have trouble reading fonts that contain a lot of curves and slants, such as cursive-type ones. Not a biggie if it's just your boss or professor you're sending the post to, but if it's going out to a large audience then it might be something to keep in mind! 7) Overusing Certain Fonts Can Be Annoying I do this too sometimes-- use a font or color that I like way more than I should, resulting in my having to re-do the post later on. It's not professional looking and it's hard for readers to focus on what you're saying when they're distracted by the pretty colors and fonts. Keep this in mind if you decide to use anything aside from the ones I've mentioned. 8) Use Them Sparingly You don't want to go overboard, even if you do it by mixing serifs and sans-serif fonts or using different fonts for titles/chapter headings etc. Like I said above, even though there are no 'wrong' fonts to use, you should still keep in mind what you want the post to convey. Be consistent, but also consider giving yourself some room for spontaneity/creativity! 9) Make Sure They're All Legible And Easy On The Eyes I know this is a repeat of 1, but it's worth reiterating-- not everybody wants to read everything in Impact. There are plenty of options out there, so test them out and see which ones work best. 10) Serif Fonts Could Also Be Helpful For Certain Audiences Kinda similar to the point I mentioned above, serif fonts are often considered easier to read for larger chunks of text (like novels). It may not hurt to use a serif font in your article if you're concerned that some people might have a hard time reading it! Whether it’s serif, sans serif, or script fonts you’re looking for, CreativeMarket has it for you. 11) Make Sure The Fonts And Colors You Choose Don't Clash This can be a really difficult thing to avoid and is often more of an art than a science. I usually try to look for styles that go together but aren't necessarily matching (think pastels vs. neons). Remember that text color can also influence how easy it is to read your fonts, so try to keep that in mind as well! 12) Leave Readers With A Good Impression This is probably what you're all thinking about regarding fonts, and it's totally true- the last thing you want to do is leave your reader feeling negative about your post or article because of something as 'small' as the text! It can be really difficult to achieve this sometimes but considering these points should help ease your mind. 13) Last But Not Least: Proofread! There's nothing that screams unprofessionalism more than a few typos or random letters scattered about your post. You may think this doesn't apply to you because it seems like such a small thing, but having your post read well is just as important as how it looks! Final Note The points above are just helpful guidelines. There's nothing wrong with using fonts that don't fall into any of the categories I mentioned here; it might even be what you're going for! The take-away point is simply to consider how your readers will perceive the text, and whether it should be kept, reworded, or scrapped. Read Also: 5 Ways to Prepare for Black Friday Sales Top User Tips For Getting Started With Salesforce

Pros and Cons of Oil and Gas Investment

The Pros:

1. There Are Tax Benefits And Advantages:

2. The Gas and Oil Industry Is a Lucrative Trade:

3. The Rate of Return on Investment Is High:

The Cons:

1. There Is a Limit to Growth:

2. There Is a Huge Political Risk Involved

3. The Market Price of Oil Is Always Fluctuating:

Conclusion:

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Content Rally

Content Rally wrapped around an online publication where you can publish your own intellectuals. It is a publishing platform designed to make great stories by content creators. This is your era, your place to be online. So come forward share your views, thoughts and ideas via Content Rally.

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7 Ways to Plan a Smooth Business Succession

4 Business Leadership Skills for Business Success

13 Things To Consider When Choosing Fonts For Sales Posts

Pros and Cons of Oil and Gas Investment

The Pros:

1. There Are Tax Benefits And Advantages:

2. The Gas and Oil Industry Is a Lucrative Trade:

3. The Rate of Return on Investment Is High:

The Cons:

1. There Is a Limit to Growth:

2. There Is a Huge Political Risk Involved

3. The Market Price of Oil Is Always Fluctuating:

Conclusion:

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Content Rally wrapped around an online publication where you can publish your own intellectuals. It is a publishing platform designed to make great stories by content creators. This is your era, your place to be online. So come forward share your views, thoughts and ideas via Content Rally.

Leave a Reply

Popular

Follow Us

Recent

Related