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3 Reasons Cramer's Bullish on Oil

Monday, 17 Oct 2011 | 7:13 PM ET
Three Big Oil and NatGas Deals
Mad Money hosts Jim Cramer explains KMP's merger with El Paso is a huge endorsement of natural gas; Statoil buying Brigham Exploration tells investors that foreigners recognize the US shale play; and ETP selling its propane biz to AmeriGas makes it a more attractive stock.

Although stocks closed near session lows Monday with all 30 Dow stocks posting losses, Cramer highlighted three important deals in the oil and natural gas complex.

To start, Kinder Morgan struck a $21 billion deal to buy the rival natural gas pipeline operator El Paso . Following news of the deal, EP surged to a 9-year high.

"I think Kinder Morgan Energy Partners is still a buy off its acquisition of El Paso because there will be accelerated distribution growth over time," the "Mad Money" host said.

Meanwhile, Statoil said it will acquire the energy company Brigham Exploration for $4.4 billion. To Cramer, Continental Resources and EOG Resources make sense as pin-action plays off Statoil's Brigham Exploration bid.

Finally, pipeline operator Energy Transfer Partners is selling off its propane assets for $2.9 billion. That's good news, Cramer said, because the propane business has long been struggling. He thinks ETP is more valuable without this business segment.

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Call Cramer: 1-800-743-CNBC

Questions for Cramer? madmoney@cnbc.com

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