Oil and natural gas are among the most favored commodities for investment since the recent recession hit the world. The recession came as a strong blow on the global economy. After two years people have come out of the recession and have found oil and natural gas as a potentially lucrative investing option. People have made their oil investment by utilizing various techniques. Oil is one of the most demanded products in the world today, and those countries which have oil reserves are very rich. These mainly include the Middle East countries like Iran, Iraq, Saudi Arabia and many more which have large reserves of oil and natural gas.

Those countries which are rich in oil reserves transport the oil to different countries and gain a lot of foreign exchange in compensation. Thus, those countries which do not have oil reserves, or do have but not in sufficient quantity for the whole economy, have to buy the oil from these Middle East countries, and others like Russia. To overcome the problem, instead of buying more and using it, people have started making oil well investments. The oil well investments are of different types. One can directly invest in the drilling of the oil field and gain relatively high returns compared to other possible methods. The other commonly practiced method is to invest indirectly by investing in the companies which are engaged in the production of oil and rely on regular dividends. Both the oil well investments options have their own pros and cons, but investing in the oil or gas sector is widely perceived as a better financial move than many other investing options available.

In the direct investment method, the investor makes an investment in the drilling of an actual, known, oil well. The drilling of any oil well is a very costly affair. There is huge machinery involved in the drilling process. With that, one also needs a team of scientists and researchers to find the potential oil reserves in different parts of the world. Sometimes, these oil reserves, so found, do not produce the estimated oil. Thus, the companies involved in the venture have to bear a loss. So by direct oil investment in an actual well, one can get loads of money, or lose a lot. It is highly risky, but if lucky, one can earn a lot also.

In the indirect investment method, the investor purchases shares of the companies which are engaged in the production of oil or those companies which are engaged in providing services to the oil sector. Investing in the shares of those companies is not as risky, as they will give dividends on regular intervals to the investor. On the other side, profit so made by the investor would not be high as compared to the direct oil investment method. So before making any choice, it is highly recommend that any interested investor consult the market veterans.