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Penny oil stocks provide one of the most explosive investment opportunities in the financial world. This is all the more true when oil prices are steadily above $100 per barrel. While companies like Exxon Mobil, Chevron and Shell will continue to post record profits in the billions and billions of dollars, the simple fact of the matter is that the efficient market hypothesis proves correct in these instances as the investing public tends to “price in” new levels of profitability in advance. Further, the bottom line is that these companies can only gain at so great a rate. By contrast, penny oil stocks well poised to exploit market trends can multiply like rabbits, making them some of the best stocks to buy now. Here are some factors to keep in mind when picking the next great winner, among all available stocks to buy. Penny Oil Stocks Chasing Oil That’s Playing Hard To Get The oil supply question can be answered depending on how you ask it. On the one hand, California is witnessing a double-digit drop in oil production each year. The state is putting out not even half of what it produced just a matter of years ago. Those are those numbers. Yet, the fact of the matter is that California also has an estimated massive oil and gas reserve that equates to about half a trillion barrels. These tens of trillions of dollars in petro could handle United States consumption for literally decades. The reserves are bound up in a stretch called the Monterey Shale, which is unique from other shale deposits in that it is primarily oil, as opposed to gas. With the massive amounts of oil, many wonder why we’re still so heavily dependent on imports. The problem is that the wells have traditionally had very poor recovery rates. It’s estimated that 90% of the available oil remains in the ground whenever a well is drilled and extraction commences. However, this may be changing thanks to new technologies and the penny oil stocks that seek to deploy them. Penny Oil Stocks Centered On New Technology One of the new technologies with promise is known as MPD (Managed Pressure Drilling). MPD makes use of injected air and a myriad of other acidic substances that help pull greater amounts of oil. MPD can actually make a cumulative contribution, as it can be used with other advances, such as more effective drilling approaches. The magic of MPD rests in the fact that it does not cost much to implement. Since the forecast for oil prices is so strong, the opportunity for such techniques to profitably exploit the Monterey Shale is tremendous. The degree to which such widespread production could alleviate a huge amount of foreign dependence is enormous. Early investors in some of the best companies can make a killing as things unfold. Penny Oil Stocks Include Far More Than Those Pumping Oil In sleuthing out the right penny oil stocks to take advantage of the shift to domestic mass production, it’s important to retain a broad perspective. In other words, it’s easy to think of the companies out there in the field drilling wells. But the companies that benefit from such enterprises are numerous. For instance, there are the oil field service providers. The oil has to be stored, and there are the refiners and companies involved in the pipelines. Branching out, you can even think about not only the equipment production companies that make it all possible, but also the eventual retail establishments that take the final product to market.