Don't Get Derailed

 | Jan 02, 2014 | 3:10 PM EST
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Stuff has to get from point A to point B, even the cleanest of stuff. And the safest and best way to move oil around is by pipeline. It's not even open for debate.

But pipelines are expensive, hard to build and subject to a ton of inspection. And environmentalists hate them. Hence, the rail issue.

Domestic oil stocks like Continental Resources (CLR) and EOG Resources (EOG) are getting killed; all I can say is that we've seen this before with pipeline spills on day two -- not on day one because there's always an analyst willing to downgrade simply because the other guys haven't (you have to do some buying).

Keep your powder dry but get ready to buy some EOG, Continental (which has the most at risk) or Noble Energy (NBL). Buy more if there's a second-day move lower.

And irony of ironies, yes, the oil from the Bakken Shale is more "dangerous" and more combustible; it's also cleaner with fewer impurities, the lightest there is, and very easy to refine. I guess that's a downside, too.

And if you believe Trinity (TRN) has to buy new tank cars, go snare the stock. It's not even up.

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