Renewable energy sources are on the rise, but a breakthrough energy form discovery aside, oil will continue to be the world's most important commodity for at least 20 years, and probably for longer than that.

And that bodes well for drillers and oil service companies, which is why I'm Reiterating my Buy rating for Oceaneering International (NYSE: OII), first recommended on April 7, 2009 at a price of $38.01. If you bought Oceaneering then, you're up more than 40%.

It goes without saying that I favor the oil sector, including drillers and oil servicers. Breakthrough energy form discovery aside, oil will continue to be the world's most important commodity for at least 15-20 years, and probably for longer than that.

Hence, I'm Reiterating my Buy rating for Oceaneering International (NYSE: OII), first recommended on April 7, 2009 at a price of $38.01.

"Midyear is as good a time as any to pause and reflect," says Richard Moroney in Dow Theory Forecasts -- a newsletter with the distinction of having been published for more than 50 years.

Here, he reviews the state of the market and offers a look at trio of favorite stocks which he considers "fundamentally superior" companies: Biogen Idec (NASDAQ: BIIB), Comcast (NASDAQ: CMCSA), and Oceaneering International (NYSE: OII).

Few sectors contained more promise during the recent global GDP expansion than drillers and oil servicers. However, few sectors became more oversold than the aforementioned, as well, during the oil bust in 2008.

Further, while one should not expect oil to return to the $140-range anytime soon, the notion that oil will remain in the $40-50 range for a long time is equally slim. And that makes the case for Oceaneering International (NYSE: OII).

"We see smooth seas ahead for deepsea driller Oceaneering International (NYSE: OII)," says Richard Moroney.

The editor of the blue chip advisory, Dow Theory Forecasts, explains, "Most of the world's untapped oil reserves lie under the ocean floor, and oil producers are spending an increasing portion of their capital budgets on deepwater drilling."

"While oil prices don't directly affect Oceaneering International's profits and cash flows, they do move the stock. Oil prices fell by two-thirds in the second half of 2008, pushing Oceaneering shares under $20 for the first time since July 2005.

"Many experts believe that oil prices are at unsustainably low prices now, and they expect a sharp rise in the commodity price as supply and demand come back into line again," says turnaround expert George Putnam.

In The Turnaround Letter, he suggests, "If oil does begin to rise again, the oilfield service stocks could rebound sharply." Here, he takes a look at large cap plays on a rebound within the oilfield services sector.

"We all know that oil prices have fallen dramatically from their highs in the summer of 2008. But different types of oil-related stocks have reacted quite differently to the price change in the underlying commodity.

"For example, while oil itself has dropped nearly 70% from its 12-month high, the stock of the largest integrated oil company, Exxon-Mobil (NYSE: XOM), is down only 26%, less than the stock market as a whole.

Analyst upgrades:

• Merrill upgraded shares of General Motors (NYSE: GM) and Ford (NYSE: F) to Neutral from Underperform on expectations for fundamentals to improve in 2009.
  
• Citigroup upgraded Chubb (NYSE: CB) and Travelers Group (NYSE: TRV) to Buy from Hold as they expect the company to benefit from the AIG (NYSE: AIG) fallout. The firm raised Chubb's target to $57 from $56 and Travelers Group's target to $51.50 from $49.50.
  
• Credit Suisse upgraded shares of SAP AG (NYSE: SAP) to Outperform from Neutral as they believe margin expansion can drive higher profitability.
• JetBlue (NASDAQ: JBLU) was upgraded to Buy from Hold at Argus.
• Goldman raised Merrill Lynch (NYSE: MER) to Neutral from Sell.
  
• NetLogic (NASDAQ: NETL) was upgraded to Buy from Neutral at Piper.

Analyst downgrades:

• JP Morgan downgraded Eli Lilly (NYSE: LLY) to Underweight from Neutral citing the company's early stage pipeline and generic competition.
  
• Merrill downgraded Unilever (NYSE: UL) to Neutral from Buy as they believe the incoming CEO is unlikely to bring a major restructuring or split up the company.

"Our 'Forecasts Focus List' contains only two energy stocks, both of which are in the oil services sector: Oceaneering International (NYSE: OII) and Transocean (NYSE: RIG)," says blue chip advisor Richard Moroney.

The editor of Dow Theory Forecasts says, "While stocks in the equipment and services group tend to move with oil prices in the near term, their profits depend more on exploration spending than on commodity prices."

"Concerns about slowing demand for crude oil and re?ned products both in the U.S. and overseas have many investors worried. But investors in the equipment and services group should not panic.

"Most producers continue to spend aggressively. And U.S. crude-oil inventories remain well below the average for this time of year, with fewer than 20 days of supply in storage.

"Demand for offshore-drilling services remains strong, giving Transocean excellent growth potential. Consensus estimates project per-share profits will rise 69% in 2008 and 15% in 2009. Transocean, the world's largest offshore drilling contractor, operates in every major drilling region.

"A combination of tight global rig supplies and the ongoing discovery of new offshore reserves have driven rig lease rates higher and kept Transocean's fleet busy. The company's largest, most expensive rigs are 95% sold out for 2009, and the backlog is growing.

TheStreet.com's Jim Cramer says lots of companies now thrive with crude up here.

Oil's not a tax on everything -- it's a tax on the consumer. That's what I come down to when I see the charts this weekend and ponder what's happening in so much of industrial America.

Company after company that I examine -- the new techs, as I call them -- actually benefit from higher oil prices. Or they can pass them on with ease, because of the worldwide demand being so strong.

Take all of the companies involved with making a Boeing (NYSE: BA) (Cramer's Take): Boeing itself, Alcoa (NYSE: AA) (Cramer's Take), Honeywell (NYSE: HON) (Cramer's Take) and Precision Castparts (NYSE: PCP) (Cramer's Take) being good examples. Each of these is necessary because the new Dreamliner burns lots less fuel, and with fuel the biggest airline cost, it stands to reason that higher energy prices make the plane more desirable even at a higher price point.

Or how about all of the companies involved with process and flow control and efficient motors: Parker-Hannifin (NYSE: PH) (Cramer's Take), Emerson (NYSE: EMR) (Cramer's Take), Eaton (NYSE: ETN) (Cramer's Take) and Flowserve (NYSE: FLS) (Cramer's Take). Those work higher with higher energy prices. CSX (NYSE: CSX) (Cramer's Take), Burlington Northern (NYSE: BNI) (Cramer's Take), Kansas City Southern (NYSE: KSU) (Cramer's Take), Union Pacific (NYSE: UNP) (Cramer's Take) and Norfolk Southern (NYSE: NSC) (Cramer's Take) are smaller energy users than trucks, and they ship plenty of ethanol and fertilizer.

With the national average of unleaded regular gasoline above $3.15 and oil's recent price surge not fully felt by refiners yet, there's a good chance gasoline will hit $4 per gallon this summer in the United States, particularly if driving patterns mirror previous summers.

Moreover, gasoline is already above $4 in certain high-cost zones in California and in Hawaii, the Associated Press reported Friday.

What's a good way to cope with the above? Turn it your advantage, to the extent possible, at both ends. Accordingly, here are a few tactics for investors and consumers in the $4 gasoline era.

It goes without saying that every defensive stock category is being tested in this market.

Moreover, while no sector is 100% bullet-proof from a market that seems to look for an excuse to decline another 200 points, the oil and oil services sector has fared reasonably well, and in this category Oceaneering International (NYSE: OII) is worth a review.

Oceaneering is an advanced technology company servicing the oil and gas industry, among others. It focuses on providing underwater drilling support, construction, inspection and repair services to oil/gas companies.

As one might estimate, OII's fortunes are tied to the strength of oil/natural gas prices and with prices at near-record levels, OII's business is strong and likely to remain so: most analysts see a long, strong, global deepwater oil services cycle.

"The energy sector has been the U.S. stock market's best performer over the past three and five years -- and among the best so far in 2007," says Richard Moroney in his Upside newsletter.

He says, "Shares of energy companies, especially equipment and services concerns, seem unduly cheap -- even if per-barrel oil prices retreat by $10 or $15." Here he looks at Gardner Denver Inc. (NYSE: GDI) and NATCO Group Inc. (NYSE: NTG).

"Over the last three years, spending on capital expenditures has grown at an impressive 28% annual clip. Even if oil and gas prices drop sharply, which seems unlikely given supply and demand forecasts -- capital spending should remain robust.

"Gardner Denver is one of the largest providers of reciprocating pumps used in oil and gas drilling and production. For full-year 2007, management lifted its per-share profit guidance to a range of $3.10 to $3.18, up from the $2.49 earned in 2006. Gardner Denver, positioned to exceed consensus profit estimates, is a Best Buy.

What are the best energy investments for long-term investors? To answer this question, I surveyed 20 of the nation's leading financial newsletter advisors to find their current favorite ideas in the energy sector.

Interestingly, the advisors see the best opportunities in areas well beyond traditional oil firms; indeed, no one included in this report chose a major integrated oil company. Rather, the advisors have shown a preference for various oil services sectors, non-oil energy sources, and developing alternative technologies.

Some focus on areas such as deep-sea operations with Diamond Offshore Drilling Inc. (NYSE: DO), Transocean Inc. (NYSE: RIG) and Oceaneering International (NYSE: OII), while others look toward oil shippers such as Nordic American Tanker Shipping (NYSE: NAT) and refiners such as Valero Energy Corp. (NYSE: VLO).

Others chose companies that make specific products needed by the oil & gas industries such as NATCO Group Inc. (NYSE: NTG), which makes a wide range of oil & gas processing systems; Dresser-Rand Group Inc. (NYSE: DRC), a maker of control systems; Gardner Denver Inc. (NYSE: GDI), which makes compressor and fluid transfer systems; Tenaris (NYSE: TS), a maker of pipes and tublar products and Schlumberger Ltd. (NYSE: SLB), the largest and most diversified of the oil services companies.

TheStreet.com's Jim Cramer says that as oil goes higher, these stocks will have even more room to run.

Name me three tech stocks that have increased more than 100% in the last year that are still cheap.

Try it! Think you can't?

I have some news for you. I have three that are still selling well under twice their growth rate that have more room to run and simply aren't done, as crazy as that seems: Oceaneering International Inc. (NYSE: OII) (Cramer's Take), FMC Technologies (NYSE: FTI) (Cramer's Take) and Core Labs (NYSE: CLB) (Cramer's Take).

I know. These are oil companies. They are not semis or software or hardware. They are technical services companies that allow companies to recoup marginal oil.

They are the ultimate tech plays on $80 oil. They are worth their weight in black gold.

MOST NOTEWORTHY: Bear Stearns (BSC), Citigroup (C), Lehman (LEH), Chicago Bridge & Iron (CBI) and Bed Bath & Beyond (BBBY) were today's noteworthy downgrades:

• Merrill downgraded Bear Stearns (NYSE: BSC), Citigroup (NYSE: C) and Lehman Brothers (NYSE: LEH) to Neutral from Buy to reflect greater earnings risk stemming from the slowdown in securitization and mortgage. Merrill also finds it "inevitable" that revenue from underwriting and advising on takeovers will slow.

• Stanford downgraded shares of Chicago Bridge & Iron (NYSE: CBI) to Sell from Hold as they believe the premium valuation is unjustified given the Lummus acquisition.

• Merrill Lynch cut Bed Bath & Beyond (NASDAQ: BBBY) to Sell from Neutral based on slowing secular growth...

OTHER DOWNGRADES:

• Goldman downgraded Zale (NYSE: ZLC) to Sell from Neutral.

• PrivateBancorp (NASDAQ: PVTB) was cut from JP Morgan's Focus List.

• Banc of America downgraded Maxim Integrated (NASDAQ: MXIM) to Neutral from Buy.

• Stanford cut Oceaneering Int'l (NYSE: OII) to Hold from Buy.

Analyst summaries provided by TheFlyOnTheWall.com (subscription required).