Most of the oil and gas exploration companies are selling at discount due to the sell off in crude oil. The stagnant crude oil prices won't last as production shut in already happening and companies are cutting capital expenditure.
Exclusive: New U.S. oil and gas well November permits tumble nearly 40 percent
http://www.reuters.com/article/2014/12/02/us-usa-oil-permits-idUSKCN0JG2C120141202Continental Resources Announces Revised 2015 Capital Budget And Guidance
Energy firms slash spending on drilling as crude’s decline accelerates
Since gas is price inelastic, the dropping prices won't cause any uptick in demand in the short run. So to close the gap between the excess supply and demand - Supply would have to be reduce. And most of U.S. shale oil productions are not profitable at the current WTI price of $55 a barrel. Prices probably won't recover until the excess inventory work itself out in summer driving season and the supply reduced in 2015. This will leave a good 6 months of lower energy and stock price. An excellent "buyers" market I must say since production won't recover until WTI reaches back to $80 a barrel.
So I will be paying close attention to inventory numbers from EIA week by week.
I don't buy the slow demand from Europe/Asia theory. World Oil Consumption, a factor of demand is still trending up
Also since oil is priced in US Dollar. The strength of the dollar is most definitely contributing to the sell off.
The problem from lower oil prices is the fact that wealth is now being transferred from net oil producing countries to net oil consumption countries. Hence, the Russian economy is getting hit particularly hard (as a net oil exporter). We should pay close attention to the possible contagion effects from these oil producing countries possibly defaulting in 2015 (ei: Venezuela/Russia). This will cause more geographic instability in these regions of the world (bad for supply but also bad for GDP growth).
OPEC is usually the swing producer - meaning they are willing to cut production to support prices. But it seems to be no longer the case this time around. Perhaps there alternative political motive behind the action. Or do they simply do it because they can?
Saudi Arabia says won't cut oil output
http://www.reuters.com/article/2014/12/21/us-oil-prices-saudi-idUSKBN0JZ05W20141221
No worries, you can always depend on America on the demand side of the equation:
SUVs hot in best November auto sales since 2001
So no doubt in my mind that oil price will rebound, it just the matter of time since shale oil is unprofitable to produce and drill below $70-80 a barrel. There is very little chance oil stay at the current level given the steady rise in consumption. The overstock of oil is relatively short term (1-2 year).
How long does a typical oil down cycle last:
http://seekingalpha.com/article/2757505-how-long-does-a-typical-oil-downcycle-last