One of ways to profit from the growth of oil industry in the U.S. is to invest in companies that supply the tools and services needed by the industry. This strategy is similar to the one followed by some investors that became rich by investing in picks and shovels rather than the gold miners during the great California gold rush of the 1800s.  Here are five reasons why investing in oil well services and equipment providers is a sound idea:

• The big oil majors such as ExxonMobil (XOM), BP Plc (BP), Chevron (CVX),  etc. prefer to contract out work related to servicing of their rigs, maintenance of pipelines, construction, etc. to other companies who specialize in those areas
• The services and technology offered by the service and equipment providers are hi-tech and cannot be easily replicated by new entrants in the field.
• In addition to the U.S. market firms in the industry have presence abroad and have the potential from growth in overseas markets.
• New discoveries of oil sources by the oil exploration and producing companies provide additional opportunity for growth.
• Natural disasters, man-made disasters, terrorism,  etc.  affecting oil wells and pipeline systems offer additional businesses to these firms on a regular basis.

Five randomly-selected oil well services and equipment providers are listed below for further research:

1.Company: Baker Hughes Inc (BHI)
Current Dividend Yield:1.31%

2.Company:Diamond Offshore Drilling Inc (DO)
Current Dividend Yield: 0.67%

3. Company: McDermott International Inc (MDR)
Current Dividend Yield: N/A

4. Company: Nabors Industries Ltd (NBR)
Current Dividend Yield: N/A

5. Company: Transocean Ltd (RIG)
Current Dividend Yield: N/A

Disclosure: No Positions