In this issue:  

 Our Best Buys list from Jan. 9 was up an average of 7.6 percent year-to-date through March 25, while the broader market eked out a 1 percent gain and the energy sector was slightly in the red. We’ve tweaked it to add some recent recommendations to the mix while taking profits on the year’s biggest winner.

The MLPs in our portfolios have also significantly outperformed their benchmark over the last 12 months, but as our primer points out MLPs have unusual tax implications and can sometimes complicate tax returns.

This could be one reason they’ve lagged stocks over the last two years, though high valuations are a more likely culprit. This week we take a look at other recent momentum swings among energy subgroups.

Finally, we introduce a recent recommendation packed with upside potential as it ramps up drilling in North Dakota’s Williston Basin. Developing shale plays continue to create new fortunes, and as long as that remains the case the energy sector should deliver the rewards commensurate with its high risks. We aim to be selectively aggressive when the facts warrant it, without falling into too many value traps.

Portfolio Action Summary

• Emerald Oil (NYSE: EOX) added to the Aggressive Portfolio as of March 18. Buy below $7.50

• Chicago Bridge & Iron (NYSE: CBI) buy below target increased to $94

• Enterprise Products Partners (NYSE: EPD) buy below target increased to $75

• Sunoco Logistics (NYSE: SXL) buy below target increased to $91

 Commodity Update

The front month contract (May) of West Texas Intermediate (WTI) traded Tuesday at $99.24/bbl, up $0.51/bbl from two weeks ago. Brent traded down $0.77/bbl to $106.99, dropping the Brent-WTI spread to $7.75/bbl. One year ago today WTI was at $94.55 ($4.69 lower than Tuesday), Brent was at $106.66 ($0.33 lower), and the Brent-WTI spread was at $12.11 and falling fast. The front month natural gas contract traded Wednesday at $4.40/MMBtu, which is down $0.09 from two weeks ago, but $0.32/MMBtu higher than the price a year ago.

In Other News

• The Jordan Cove LNG export terminal in Southern Oregon gained the seventh approval from the Department of Energy for an LNG export terminal, and the first one on the West Coast.

• Shares of advanced biofuel producer KiOR (NASDAQ: KiOR) are down nearly 70 percent since the company announced last week it was on the verge of bankruptcy.

• According to the latest natural gas inventory report from the EIA, inventories have dropped below 1 trillion cubic feet for the first time in 11 years.

• Forbes reports that Chesapeake Energy (NYSE: CHK) continues to come under fire over accusations of underpaying royalties to landowners.

• A spill from an oil barge closed the Houston Ship Channel and forced ExxonMobil (NYSE: XOM) to cut output at its 561,000 bpd refinery in Baytown, Texas.