Stock Highlight: CVX

My starting position for Energy was going to be one of the big oil companies. Among CVX, BP, XOM, RDS, or COP, I eliminated BP because I already hold them in my Roth and don't want to be further exposed to potential litigation risk. RDS was also eliminated because I didn't want to deal with foreign taxes again (I had owned RDS.B previously).

Between XOM, CVX and COP, Chevron had the most appeal to me and at the time it was trading below its moving averages. (I also only fill up with Chevron or Shell so I was slightly biased).

Reading over their 2012 annual report I found their largest reserves are in the Americas (for liquids) and Asia \Australia (for natural gas). This is important because it means over fifty percent of their operations are in stable environments.

Specifically for the US, I was surprised California outputs more crude (liquids) than the Gulf.



On the downstream business side they are focusing on high margin refining of oils, lubricants, and chemicals while selling off non-performing assets. The goal is to have this be a steady stream of income to supplement the upstream business growth.

I plan on making CVX the largest slice of my portfolio and will later add smaller drilling and exploration companies.