It goes without saying that the investment strategy advocated here favors integrated oil companies, particularly those with a regional or product advantage. And with the aforementioned in mind, I'm reiterating my buy rating for Petroleo Brasileiro SA (PBR), also known as Petrobras, first recommended on April 22, 2009, at a price of $32.99. If you bought PBR in April, you're up an impressive 47%.

Petrobras remains on-track for 5% to 6% oil/natural gas production growth for FY2009 or about 2.54 million barrels of oil equivalent per day; longer-term, a roughly 7% to 7.5% average annual production increase is seen for 2010 to 2013.

Analyst upgrades:

• Citigroup upgraded Cooper Industries (NYSE: CBE) to Buy from Hold on valuation as it believes commercial construction concerns are well known. The firm raised its target on shares to $40 from $37, and coupled the upgrade with a downgrade of Rockwell Automation (NYSE: ROK) to Sell from Hold.
• Credit Suisse upgraded BJ Services (NYSE: BJS) to Neutral from Underperform following its acquisition by Baker Hughes (NYSE: BHI). The firm raised its target to $17.
• Credit Suisse also upgraded Amkor Technology (NASDAQ: AMKR) to Outperform from Neutral and raised its target to $8 from $7. The firm expects Amkor to benefit from near-term strength in the supply chain and the mix shift towards higher value packaging.
• Textron (NYSE: TXT) was upgraded to Conviction Buy from Neutral at Goldman.
• Siemens (NYSE: SI) was upgraded to Neutral from Sell at UBS.
• Stanley Works (NYSE: SWK) was upgraded to Buy from Neutral at Janney Montgomery.

It goes without saying that one of the sectors preferred in this space is the integrated oil sector, and when one can combine a demonstrated business model with a dominant market position, that's the equivalent of a baseball doubleheader, which is why Brazil-based Petroleo Brasileiro SA (NYSE: PBR), also known as Petrobras, is worth a review.

In general, analysts expect Petrobras' oil and gas production to increase about 2% in 2009. The company has proved reserves of 11.7 billion barrels of oil equivalent, 14,200 wells, and 5,970 gas stations.

Petrobras (NYSE: PBR) closed at $32.30. Crude oil futures are recently down 1.86% to $50.65 a barrel according to Bloomberg. April option implied volatility is at 69; July is at 66; below its 26-week average of 80, according to Track Data, suggesting decreasing price movement.

Harmony Gold (NYSE: HMY), the fifth largest gold producer globally, closed at $12.15. Gold is recently down .47% to $954.30 according to Bloomberg. HMY April option implied volatility of 67 is below its 26-week average of 89, according to Track Data, suggesting decreasing movement.

Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com

Petrobras, Brazil's state-owned oil company has decided to invest in oil fields recently discovered under several kilometers of sea water. To obtain the oil it must drill into a hard-to-penetrate layer of salt. So far, no estimate of the size of the find has been made, however some say that the reserve may contain as much as 100 billion barrels. At present, Brazil has proven reserves of 14.4 billion barrels.

Petrobras plans to invest $174.4 billion over the next four years, including $28 billion on the new fields.

Last week Exxon Mobil (NYSE: XOM) and Hess (NYSE: HES) announced the discovery of oil in a pre-salt field. Exxon Mobil and Hess each own 40% of the partnership and Petrobras owns 20%. Petrobras also owns two nearby fields at Tupi with estimates of 5 billion barrels and 8 billion barrels respectively.

Disney (NYSE: DIS) closed at $28.26 Monday. DIS is expected to report Q4 EPS in early November. DIS November option implied volatility of 54 is above it 26-week average of 31 according to Track Data, suggesting larger movement.

Whirlpool (NYSE: WHR) closed at $70.10 Monday. WHR is scheduled to report Q3 EPS in late October. WHR overall option implied volatility of 83 is above its 26-week average of 44 according to Track Data, suggesting larger price movement.

Petrobras (NYSE: PBR) closed at $34.20 Monday. Crude oil futures are recently up 3.89% to $91.23 according to Bloomberg. PBR October option implied volatility is at 167; November is at 127; above its 26-week average of 48 according to Track Data, suggesting larger price movement.

Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com

"Crude oil remains deeply oversold on an intermediate-term basis, suggesting a rally sometime in the early fall," says Dennis Slothower.

The editor of Stealth Stocks looks to Petroleo Brasileiro SA (NYSE: PBR) as his latest "stock of the month." Here's his review of the Brazilian firm that is now the world's 8th-largest oil company.

"The founding of Petrobras was authorized in October 1953, with the objective of executing, on behalf of the federal government, the activities of the oil sector in Brazil.

"Over the past five decades or so, the company has become the country's leader in the distribution of oil products, an activity not covered by the government monopoly, and today it is internationally acknowledged as the eighth-largest oil company in the world.

"Leading the sector in the development of one of the most advanced deepwater and ultra-deepwater technologies for oil production, PBR was twice (in 1992 and 2001) awarded the Offshore Technology Company (OTC) prize, the most important award in the sector.

The list of reasons that oil is trading near $150 a barrel gets longer by the day: speculation, greed at OPEC member countries, rising consumption in India and China and so on.

Perhaps the most worrisome aspect of oil prices is supply interruptions in major exporting nations. Worries about Nigeria and Iran have helped move the cost of crude up over the last few months. Now another big threat can be put on that list.

Oil workers at Petrobras, the Brazilian oil company, have gone out on strike. Brazil is a modestly important supplier of crude, but with the recent discovery of large off-shore deposits, its role is likely to grow.

According to Bloomberg, the strike "may cut Brazilian daily oil output by more than half."

The strike raises two problems, one short term. The psychology of oil prices is so fragile now that even rumors of supply interruptions push crude up. The other, more important problem, is in the future. Brazil's new and significant oil reserves will make the world more dependent on the country for crude. If the workers can strike now to get higher wages, they can strike later. That puts Brazil's output at a level of permanent risk.

Douglas A. McIntyre is an editor at 247wallst.com.

"Rio de Janiero-based Petroleo Brasileiro S.A. (NYSE: PBR) is in the heart of the global growth story," says Daniel Frishberg, BizRadio host and editor of The MoneyMan Market Newsletter.

"In general, investors are still seeing selloffs as buying opportunities even though the majority of stocks are in a bear market. We are not sure how long this can continue.

"Our 'Crazy Investor Index' does not yet show the type of extreme fear that is typical at a bottom, so it will probably mill around in short-term rallies and selloffs until something motivates them to panic simultaneously.

"In the meantime, we prefer to buy excellent companies just as the herd decides to stampede. And while our portfolio is now slightly net short we are adding one new long position: Petroleo Brasileiro S.A., often referred to as Petrobras.

MOST NOTEWORTHY: SuccessFactors, Taleo and Penn National were today's noteworthy initiations:

• Oppenheimer initiated SuccessFactors Inc (NASDAQ: SFSF) with an Outperform rating and $15 target. The firm believes the company's double-digit revenue growth will continue as its differentiated HCM solutions gain broad-based adoption. Deutsche Bank believes the company has a strong opportunity to build a highly profitable business as it broadens its footprint, and started shares with a Buy rating and $15 target.
• Deutsche Bank also reinstated coverage of Taleo Corporation (NASDAQ: TLEO) with a Buy rating and $35 target. The firm believes the Vurv acquisition will create significant accretion in 2009 and that investors should take advantage of the recent share weakness.
• Oppenheimer assumed coverage of Penn National Gaming Inc (NASDAQ: PENN) with an Outperform rating and believes the termination of Penn's acquisition by Fortress Investment and Centerbridge will be catalysts for the stock, as they think it provides the company with financial flexibility. In addition, the firm believes Penn's management team has historically made prudent capital decisions.

OTHER INITIATIONS:

• Petrobras Brasileiro SA (NYSE: PBR) was initiated with a Buy rating and $92 target at Goldman.
• Cowen resumed coverage of LeMaitre Vascular Inc (NASDAQ: LMAT) with an Outperform rating.
• Sanofi-Aventis SA (NYSE: SNY) was started at ING with a Hold rating.

TheStreet.com's Jim Cramer says the oil powwow won't solve anything, but it will give you an opening in the stocks.

Today we learn that "dozens of world leaders and executives" are going to Saudi Arabia to find out how to lower oil prices this weekend.

Yep, there we go. Short the oil futures. They will no doubt come up with a plan that will produce much more oil and curtail its use, bringing oil down sharply -- perhaps to $100.

Yeah, right.

Weak dollar, speculators, funds indexed to commodities, intransigent Saudi Arabians, terrorist activities.

I believe that all of those factors combined have lifted oil by about $20. But that could be overstating things -- it's no more than that.

Because if there was a lot of oil, you would see those futures smacked down to levels where all sort of cockamamie ideas for oil alternatives would disappear. Right now, with oil at $130, we could produce an alternative from oil shale that would be bountiful and that has been the spare capacity that can be brought on in the next four years.

Other than that, forget about it.

Petrobras (NYSE: PBR) closed at $74.11 Tuesday, a record high.

Crude oil futures are recently up 0.81% to $130.02 according to Bloomberg.

PBR announced its intent to hire 40 drilling ships and semi-submersible drilling platforms to operate in deep and ultra-deep waters.

PBR June option implied volatility of 48 is near its 26-week average according to Track Data, suggesting non-directional risk.

Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com

Oil driller Transocean, Inc. (NYSE: RIG), whose shares have probed, but have been unable to move and stay permanently above $160 -- may have received the catalyst it needs to reach loftier price levels.

Transocean's shares jumped $8.34, ending at $155.54 after Bloomberg News reported that Petroleo Brasileiro (NYSE: PBR), Brasil's state-controlled oil company, leased about 80% percent of the world's deepest-drilling offshore rigs to explore prospects. That included the Western Hemisphere's biggest discovery in decades, the Tupi field. Further, the activity of Petroleo, also known as Petrobras, is forcing up day-rates for oil rigs. PBR also closed higher Thursday, up $2.00 to $68.27.

Further, Petrobras is in talks with Transocean to extend leases as much as three years ahead of expiration, Robert Long, chief executive officer for the Houston-based RIG, told Bloomberg News. Also, Petrobras plans to start pumping oil from Tupi in Q1 2009. Tupi is the largest oil find in North America since the 1976 Cantarelli field discovery in the Gulf of Mexico.

Petrobras (NYSE: PBR), a Brazil based oil and gas company, closed at $126.18 Wednesday.

PBR is expected to report Q1 EPS on May 12.

Crude oil futures are recently at $117.57 according to Bloomberg.

PBR May option implied volatility of 55 is above its 26-week average of 51 according to Track Data, suggesting larger price risk.

Volatility Index S&P 500 Options-VIX at 20.26; 10-day moving average is 21.46

Options Update is provided by Stock Specialist Paul Foster of theflyonthewall.com

MOST NOTEWORTHY: Pacer Int'l (PACR), ComScore (SCOR), Riverbed Technology (RVBD) and CBS Corp (CBS) were today's noteworthy initiations:

• William Blair believes Pacer Int'l (NASDAQ: PACR) is in a favorable industry, with growth-specific opportunities and short-term concerns and started shares with a Market Perform rating.

• William Blair starting ComScore (NASDAQ: SCOR) with an Outperform rating, believing the online marketing research sector will have 20%+ growth over the next 3-5 years.

• Nollenberger believes Riverbed (NASDAQ: RVBD) is positioned to gain market share and is a technology and product leader, starting shares with a Buy rating and $55 target. BMO

• Capital initiated CBS Corp (NYSE: CBS) with an Outperform and expects the stock is $1.74/share for 2007 and $2.03 in 2008 with upside should there be a levered buyback...

OTHER INITIATIONS:

• Life Time Fitness (NYSE: LTM) was started with a Buy rating and $67 target at ThinkEquity.

• Citigroup started Petrobras (NYSE: PBR) with a Buy rating.

• SMH Capital initiated Energen (NYSE: EGN) with a Buy.

• Keybanc started WABCO Holdings (NYSE: WBC) with a Buy rating.

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