Peak Oil Stocks for the Future

by: William Ellard May 22, 2008 | about stocks: APA / BRNC / CHK / CPST / DVN / ECA / FCEL / HP / NBR / PDC / PDE / PDS / PGH / PVX / SFY    

William Ellard

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Oil prices, US oil independence and basic economics

I just listened to the another politician screaming about opening up ANWR for oil development. These politicians claim our recent sky high oil prices are due to lack of new supply here in the US. As an economist, and an energy user, this view really annoys me You can't dig yourself out of this scarce resource pricing issue. One needs to let economics work: prices need to continue to rise, until demand falls and alternatives are properly funded.

These same politicians also claim that the US economy will crash due to the high cost of hydrocarbons. Actually, I believe the opposite is true. The US oil fueled economy is old and tired. A new vibrant US economy is coming - if we start real investing in all the oil alternative technologies.

US oil independence and ANWR

Let's be very open and clear. If you want the US to be independent from middle eastern oil, the price to the end users needs to continue to rise. While the US should continue to drill in all our current developed areas (US land, GOM up to 2 miles of coastline, deep water, etc.), there is no economic reason to drill in ANWR.

An Energy Information Administration analysis in 2004 concluded that "by 2025 ANWR is projected to reach .9M barrels a day". This report further states that it would take about 12 years for the US to receive any hydrocarbon from ANWR. So, if ANWR were approved today, the US would get its first barrels of oil in 2020. Of course, between now and 2020, there would need to be a huge increase in infrastructure and construction activity to develop ANWR. This activity needs energy, specifically diesel fuel for all this construction. The US would have a further rise in oil demand while this project is being built-out, increasing fuel cost for all Americans.

With this above time-frame in mind, it appears some politicians feel we will still be highly dependent on oil in 2020-2040. We could just build cars that don't use oil, would this not be more logical? My view is to just let economics work. Gas at the pump at 5-10 dollars a gallon would make the manufacturing of the combustion engine vehicle a big ole dodo bird.

Even better, the US does not need any technological breakthrough to make the current vehicle engine extinct. Coal liquification into diesel fuel has been done on a large scale since WWII. Can the CTL technology be clean? Well, yes it could, but not at 3 bucks a gallon. The diesel engine is 30% more efficient than a combustion engine, so if we use coal vs oil, this one component change would make the US independent from middle eastern oil.

We also have natural gas powered cars, fuel cell and electric cars. These technologies are here today, and will continue to improve every year if we allow natural economics to continue.

Peak oil theory

This is a very misunderstood concept. Peak oil has very little to do with actual oil reserves. Let's assume that the world has 100 years of oil reserves; hell for argument's sake, let's just bump that figure up to 2,000 year's supply of oil reserves. So with 2,000 years of oil left, how does the peak oil theory stand up? Actually, very well. One needs to understand economics and infrastructure.

Peak oil has nothing to do with reserves, but instead with the rate of extraction, distribution, and refinement. Wiki gives a concise view:

Peak oil is the point in time when the maximum rate of global petroleum production is reached, after which the rate of production enters its terminal decline.

Currently, world oil extraction and distribution is about 85 million barrels a day. Is this the peak? Hard to say, but we can say based on economics that the world is either at the peak or within 5-10% of a possible peak. Current actual demand is estimated to be around 87 million barrels a day, so it's obvious that prices will continue to rise until demand is brought back in balance. Here is Boone Picken's current view:

Eighty-five million barrels of oil a day is all the world can produce, and the demand is 87 million," he said. "It's just that simple. It doesn't have anything to do with the value of the dollar.

Of course we need assumptions. An economist can't get through the day without a few assumptions! Here are my world oil economic assumptions.

  1. World-wide demand for energy and transportation energy will continue to increase between 1-3% per annum.
  2. Supply and distribution of oil will be between 85-87 million barrels a day.
  3. World-wide pollution taxes, or cap and trade programs, to increase dramatically over the next 10 years, the effect of which is a 10-20% tax on polluting sources of energy (oil and coal).

So if the world is currently capped at about 85M barrels a day of extraction and distribution, but demand for oil rises 3% per annum, what happens next? Since the demand curve for oil is very inelastic, this means that the price of oil can rise very sharply in the short term. This is what we have seen during the past 3-4 years.

For me, as a long term investor, I am very interested in the next question: What about the pricing dynamics for oil in the long term? This is also the most important question for any decision on ANWR, since consumers will not see any significant oil from ANWR until 2025.

Long term oil economics

This is more complex than it appears. As stated above, the short term economics indicate much higher oil related energy prices given the above assumptions. Governments and investors all over the world are very interested in this topic. We all see that it is transportation - vehicles - that drive the demand and price for oil. For the first time, it is clear that alternative vehicles will be competitive long term.

In order for current oil extraction and distribution to even stay at 85M a day, or to increase this amount, oil infrastructure investment must increase. For future extraction, the world needs new oil platforms and deep sea oil rigs. For transportation, the world needs VLCCs - 500,000 dead weight tons of steel. Once transported, we need large refineries to create the distillates. After refining, we need miles of steel pipelines, trucks, etc. In the medium term, I like investing in steel stocks.

The cost of the above infrastructure is huge. Building a VLCC takes years, at a cost of over 120 million. This cost has risen over 50% in just a few years. As fuel costs rise, the cost to make everything also rises - steel plates, large diesel engines, precision tolls,etc. This economic dynamic is the same for the very expensive new rigs, refining capacity and transportation pipelines and vehicles.

Here comes the crux. CEOs of firms in the oil industry must always do a financial cost benefit analysis of these new large infrastructure purchases. With the current high cost of gas and diesel ($4-5 dollars a gallon), and pollution taxes in the future increasing this price to over $5 a gallon for the foreseeable future, alternative natural gas engines (1-3 dollars a gallon), electric vehicle engines (under $1 a gallon) and coal-diesel engines (4 dollars a gallon) are all economically preferred.

With the much higher differential in the cost of powering the current oil based vehicle engines, the world will quickly adopt natural gas, battery and fuel cell powered vehicles over the next 10 years. So why invest 120 million dollars in a large crude carrier when it could be obsolete in 10 years? The same thinking applies to large oil rigs, new refineries, etc. And again, why waste money money drilling in ANWR - by the time the US gets the oil, we probably will not even need it.

As in investing and life, timing is everything. When will firms stop ordering all this expensive oil infrastructure equipment? If they were prudent, I would expect a drop-off in oil infrastructure demand over the next 3-5 years.

What will happen with oil prices?

As stated above, oil prices will continue to stay high in the short run, but at some point in the next few years, I predict a downturn in oil prices, as alternative power sources are used in vehicles. This is how economics should work. I am surprised that this shift has taken 100 years. As an investor, this changes how I value many energy firms.

Firms that are 100% levered to the extraction and distribution of oil will have falling cash flows after 2013-2015, in my humble opinion. Individuals and businesses change their vehicles quite often - every 3-5 years - so one can see how the technological changes in the transportation area can impact the demand for oil fairly quickly. As for the electric generation, this timing is different. We don't change our power plants out every 5 years, so the demand for coal and natural gas will remain strong at least 10 years out.

As I have written before, firms that are in the natural gas business will outperform the oil related firms in the future. Also, firms in battery and fuel cell technology should outperform. These changes will invigorate the US economy - if the government stays out of the way. Current ethanol mandates and ANWR drilling plans all have one effect - to slow down the natural economic change from oil to all its alternatives.

Some of my favorite long term stocks for this peak oil economics are:

  • Precision Drilling (PDS)
  • Apache Corporation (APA)
  • Chesapeake Energy (CHK)
  • Pengrowth Energy Trust (PGH)
  • Provident Energy Trust (PVX)
  • Pride International (PDE)
  • Bronco Drilling (BRNC)
  • Helmerich & Payne (HP)
  • Swift Energy (SFY)
  • Pioneer Drilling (PDC)
  • EnCana Corporation (ECA)
  • Nabors Industries (NBR)
  • Devon Energy (DVN)
  • Capstone Turbine (CPST)
  • FuelCell Energy (FCEL)

Disclosure: Author holds positions in CHK, BRNC, APA, and CPST

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This article has 55 comments:

  •  
    May 22 08:49 AM
    We need to drill where the oil is...if we had drilled in ANWAR when Clinton stopped it, we would have the oil now.

    Yes, oil needed to rise to make investments in alternative technologies viable...an it has!

    Our Congressmen are totally nuts!...but Mr. Ellard is just as nuts on the opposite end. He sits on his lofty perch and completely ignores the economic destruction, job losses, and international chaos now accelerating to no one knows what conclusion (and long before his favorite alternative energy stocks produce a meaningful impact). It will be YEARS before wind, solar, biofuels, wave, geothermal, or others make a significant contribution to our energy needs. Oil doubling in a year is not good for either the short term or long term. The bubble must burst so we can catch our breath.
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  •  
    May 22 09:44 AM
    Mr. Ellard is right on. There is no bubble to burst. Oil is high and will get higher. If we convert all our coal fired power plants and vehicles to Natural gas and compressed natural gas, respectively, our polution and supply problems could be fixed by next year. We have maybe hundreds of years of reserves and natural gas, which is 80% hydrogen, burns cleaner than almost any other fuel. Lets get a move on. Git er done!
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  •  
    May 22 09:48 AM
    The oil executives now testifying before congress (and their lackeys in congress and the Bush administration) have redefined chutzpah. It used to be defined by a man who murdered his parents and asked for clemency from the court because he is an orphan. Now chutzpah is defined by an oil executive who explains his company's tremendous profits (and his enormous salary) are because he's not allowed to drill in ANWR.
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  •  
    May 22 10:20 AM
    Richjoy - perhaps you should actually read the article before calling someone nuts. ANWR drilling solves nothing and needlessly ruins a pristine environment. If ANWR had been drilled in the 90's we would still be where we are today. Stop living in the past. If the auto makers wouldn't have created the SUV and made more fuel efficent cars in the 90's we'd be better off today but that didn't happen either! Perhaps you should ditch your bias and look at the facts instead.
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  •  
    May 22 10:45 AM
    "economic destruction, job losses"

    Actually you are incorrect. High oil prices increase US GDP and economic activity.
    This is the chart of crude oil prices and real GDP for the past 10 years:

    ============== oil===================...
    Year==oil ====Price inc.===real GDP growth
    ----------------------...
    1998== $11.91
    1999== $16.56===+39%===== 4.5%
    2000== $27.39===+65%===== 3.7%
    2001== $23.00=== -17%==== 1%
    2002== $22.81===-1%===== 1.6%
    2003== $27.69===21%===== 2.5%
    2004== $37.66===36%===== 3.6%
    2005== $50.04===32%===== 3.1%
    2006== $58.30===17%===== 2.9%
    2007== $64.20===10%===== 2.2%

    As one can see, there is no negative correlation between oil price increases and real GDP changes. If fact the data shows a positive correlation. The years with highest oil price increase - 1999, 2000,2004,2005 had the highest real GDP growth - well above normal.

    Conversly the years with negative oil price changes 2001, 2002 - had the weakest growth.

    The reasons are simple - with increases in prices, drilling and exploring activity increases big time - creating jobs and higher GDP. Also alternatives start to get funded, creating more jobs.

    If you think oil independence is important for national and economic security as I do - the only fix is higher, higher prices for all oil related products - the main one being gas at the pump.


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  •  
    May 22 11:23 AM
    This article is well-intentioned, and the primary thesis behind it that price should determine supply and demand and hence solve the energy conundrum is sound. However, the problem comes up when the author points to some directions and potential solutions of which he does not know enough. This actually is one of the primary problems why an expeditious solution to the problem is not going to be easy. There are too many amateurs around, though having good foundations in economic and financial analysis, are not sophisticated enough about the sciences and the engineering. Even scientists and engineers per se fail on these issues very frequently because they often lack the wide range of knowledge and experience they shouild have for making an apt contribution. One only has one life-time to live and contribute. Often it takes more than that to genrate the right approaches!

    The author mentions CTL from coal. Well, he is right that this could have been intiated long ago (I was a manager of some Federal programs relating to this area in the distant past!) However, in the context of global warming threatening us, this would be one of the most misguided and horrible approaches to solve our energy problem. The efficiency of converting coal through CTL is only about 50%. Petroleum cracking to yield the spectrum of products we use (diesel, gasoline, and chemicals, etc) has an efficiency of about 90%. Think about doubling CO2 when anyone mentions CTL from coal, and also efficiency! Perhaps, more than doubling CO2, if bureaucrats, engineers and other less sophisticated persons are willing to consider that it takes a lot more to mine coal (think diesel powered heavy equipment, electricity, etc) , transport it by rail/truck, etc. I would not be surprised if someone comes up with an overall efficiency of less than 40%, after factoring these issues. Pumping petroleum or gas out of the ground and transporting it by pipe and/or ships is far more efficient, and hence less CO2 polluting. Petroleum has far more hydrogen in it than coal, and unit energy per unit energy generates significantly less CO2 than the use of liquids derived through CTL from coal.

    Most of the public discussions now on the subject of CO2 is dominated be politicians, public policy "experts"/do... , bureaucrats and so-called environmentalists who do not have enouch knowledge at their command. Sadly, they do not want to seek out the few well-grounded people available(such as your's truely) who shun the public limelight or the rough and tumble of that come from swollen egos. Quite often they don't have the time and patience for acquiring the deep real knowledge required. That is how we have gotten into the wrong tracks like producing alcohol from grain which is ruining our planet and is going to increase poverty around!

    There are other statements in the article which cannot be supported by rigorous scientific analysis, though the ideas seem to bew current wisdom in the public domain. In a nut-shell, without going through the sophisticated reasons like the above and others relating to gas, power, etc., the approach of producing CTL from natural gas is also not a good idea. It should be used in other ways to meet our energy needs, and at the same time enhance our global warming interests. But this is a very sophisticated discussion which has not even been touched yet, as far as I know.
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  •  
    May 22 11:54 AM
    Why aren't there hearings inthe the profit margins on Nintendo or Take-Two's games, they make more than 10-12% net on their product, oh yah I know, it makes no political points. If the oil companies weren't dealing with such huge numbers 10%-12% NET profit wouldn't mean anything. It;s like tobacco, no politician will defend oil or tobacco because it gets them no points so they just keep holding hearings. Stop wasting time, if I was an oil exec. I would just call them out on live TV and ask "exactly what has congress or the senate done to help increase oil supplies in the last 10-15 years? Then the hearings would stop
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  •  
    May 22 12:11 PM
    You can't have it both ways, Mr. Ellard.

    There is a decade lag in developing new oil fields. It takes almost as long for consumption profile to change. If consumers bought only subcompact or alternative fuel vehicles, the national gasoline consumption won't appreciably decline for several years.

    I do agree that petroleum prices have to high and stay high for new investments to bite. Let market forces affect both oil production and alter consumption patterns.

    The estimated recoverable reserve at ANWR is put at 6 to 10 billion barrels -- roughly a cool trillion dollars. Think about NOT sending a trillion dollars to the Middle East.

    C'mon, I have to believe we know how to do "low impact" drilling. Declaring ANWR out of bounds is pure NIMBY. It is ok to drill in the fertile river delta of Nigeria instead? Please explain how the Earth's environment is thus improved.
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  •  
    May 22 12:16 PM
    I couldn't finish this article before barfing! We need to drill for the oil wherever the oil is; period.

    The greenpeace folks have gotten us in the current mess were in today and the silent majority needs to speak up or we're all finished.
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  •  
    May 22 12:17 PM
    Like the article. Very interested in coal gasification! US has more coal than any other nation/continent. Too long a time line on ANWAR, need/profit will push construction to 1/2 the time then 1/2 it again. 1 million barrels/day = all crude US gets from Saudi Arabia today. High oil impacts everything not just fuel use; plastics, fabric, electronics, food production, etc. Keep in mind that more than 1/2 of US carbon fuel goes to produce electricity! Most burn coal, it will take billions to replace them with natural gas or nuclear. An individuals car or SUV is nothing on the scale of fosil fuels, trucks hauling frieght is significant, passenger cars are blip on the radar screen.
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  •  
    May 22 12:22 PM
    Hi Brahm;
    Thanks for your input. My article is based on the science of economics. My original degree was in marine biology(unfinished), and my overall background in the sciences are sound, but not up to your level.

    I have researched technologies heavily over the past 5 years including CTL and the FT processes. My current view is that we need pollution taxes on NOx, SOx, and mercury. I am not so sure on CO2. So unless CTL can be done without a pollution reduction, then it will not work for me. Can CTL be done without increased pollution? You would know better than I, but I think at the right price it could be. The efficiency issues are important, but the US needs a viable alternative away from oil based vehicle transport. What power source do you think is best for out auto, and truck fleet.

    I think developing plug in, and fast charge electric vehicles would be the best solution, Since we could manage energy, and pollution from much fewer power points - the grid, now we have millions of little inefficient power plants driving all over the place!.Then we could just tax pollution and let economics decide which is the correct energy for the future. When the government picks the winners(Ethanol) with subsidies, everyone losses IMHO.

    I am getting ready to start a web site on energy economics, and future policy decision needed to move the US into the future. Your input would great to have. e-mail me if you the time at bellard@yahoo.com.

    regards;

    William Ellard
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  •  
    May 22 12:35 PM
    Oilsupply and Shag;
    I was hoping for responses, maybe not barf-age! Thanks for your opinion, and I do agree with continuing to drill. Yes I am an environmentalist, but also a capitalist pig. I own CHK, and many oil firms, drillers, refiners, etc....Greed and drilling is good, and can be done in an environmental safe way.

    My personal view as stated in the article about ANWR, is that it just does not make economic sense. Lets drill our coastal waters were the infrastructure already exist.

    I would have to respectfully disagree on how long it will take for the US to move away from oil based combustion engines as the main source of automotive power. If we just shift the income tax to gas taxes(net would be less total taxes), and create the proper economic incentives for new technology - The US will respond with greed, and US economic activity would thrive IMHO. If the US auto fleet just moved to clean diesel technology, we would not need middle eastern oil.

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  •  
    May 22 01:40 PM
    I agree with Brahm here. It does not make sense that the author wants to 'protect' our environment by not drilling ANWR, but suggests coal to liquids which would release tremendous amounts of carbon dioxide. These types of plants can't get funding because the investors realize that future carbon emission limitations might prevent them from operating the plants for their expected lifetimes and they are not going to risk losing the huge investments required. It is even difficult now to fund a coal-fired power plant for the same reason.

    We should have a plan to reduce greenhouse emissions and it should start with cutting back on fuels like coal that have the highest carbon emissions for the energy produced. Oil should be in the mix of fuels we use now until we can produce all of our energy from alternative fuels. I have a web site on Global Warming (examiner.com/x-325-Gl... where I discuss how the mix of fuels affects our environment. So called environmentalists who are against any type of fossil fuel production are actually making the global warming situation worse. We are not producing enough new alternative energy to even meet increasing demand, much less replace existing fossil fuel consumption. I could take 40 years to switch to alternative fuels. To suggest that everything will change in a few years is not reasonable. 'All we need is hope' will not put gas in the tank.

    Not producing oil from ANWR hurts us economically, about $1 trillion dollars that we will import from foreign countries. It hurts our trade balance which hurts the value of the dollar. It causes industry to move off-shore to countries like China that pollute worse than we do. It hurts the people in Alaska who won't get the tax revenue for their state endowment fund. It hurts everyone who has to pay higher prices for gasoline (special thank you to Bill Clinton), and can't buy an alternative energy vehicle this year. It's not just ANWR, but also all of the oil and gas resources off our coast that can't be utilized.

    Drilling in ANWR will only require about 2,000 acres out of 1.2 million acres in the reserve. A lot of infrastructure like the Alaska pipleline is already in place. Some of the time-line estimates include the time to fight the legal challenges. This supply could come on faster than some of the estimates.

    I am actually very bullish on natural gas producers. Replacing all of our coal plants with natural gas would cut the emission of carbon dioxide from electric generation in half. But it is not going to happen in 3 years. This would be a huge infrastructure investment in new gas wells and pipelines. Maybe in 30 years, a little at a time. Some of that natural gas may come from ANWR.
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  •  
    May 22 02:28 PM
    Shaggie, I too puked in my mouth but only because it reminded me my tank is almost on E and undoubtedly the cost of a gallon of gas has increased today.
    Thoroughbred, (nice tag, way to go Big Brown) Nintendo can make 50% net on its products and most of America would not care because you can't fit a Nintendo in your gas tank. What I mean by that is that without gasoline I cannot get to work and I can't make the money to pay for more gas. However, you are right about politicians...but we put them there, right? Last I heard they don't even fill their gas tanks, we do with our taxes.
    Mr. Ellard, nice article. We are a impulsive people, and greedy. Until demand diminishes (which it will not because last time I checked there were way too many me-me-me baby boomers) we will be paying more at the pump. Hey baby boomers, maybe you can stop buying your kids those fancy cars and paying for their gas. Make them get jobs and learn the value of a dollar... oh wait, does a dollar have any value today?



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  •  
    May 22 03:08 PM
    We need to develop our domestic sources asap. In addition we need to start developing alternative sources- coal, nuclear, solar, etc.

    The $100+ dollar/barrel oil prices are a blessing in disguise, because they make alternatives economically possible. But they will kill us (potentially literally) if there is no organization around developing the alternatives.

    This is coupled with a collapse of our financial system. That is the 1, 2 double punch and you are out.

    We need, in addition to the above energy scenarios, to TakeBackTheFed.com

    If we do not get off our duffs, we will truly be in trouble. NOW IS THE TIME TO ACT.
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  •  
    May 22 03:17 PM
    In terms of selecting the "right" companies, this is extremely problematic. Buy either IEO or XOP for more peace of mind.
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  •  
    May 22 03:19 PM
    I am joining your revolution sivere.
    I agree alternatives must be pursued and fast. But the problem is financing and politics. Where do you get the money to completely overhaul the American infrastructure and where do you get the money to grease the political machine?...oops...did I just say that? What I mean is old dogs don't learn new tricks...not even for a bone....
    What we really need is for Americans to start using their brains instead of allowing themselves to be led like cattle to the slaughter. Whose bright idea was it to use all the corn (that we need to EAT by the way, i.e. survive) for a biofuel? What a dumb idea, and don't think we aren't paying the price for that one too.
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  •  
    May 22 03:49 PM
    Global Warming;
    My article does not suggest at all that we should not drill in ANWR for environmental reasons. My reasons are purely economics - it does not make sense IMHO. We should drill in the lower 48, and coast as we have all the infrastructure already.

    If the US does not get a comprehensive energy policy - economics will do the job - but in a more painful way. We need to raise the price of energy from oil, to the point were the US demands 20-30% less of it.

    Since the demand curve is very inelastic - the price at the pump may need to go up much more than 30%. This will not take decades - one way or another, the US can not economically use this much oil. We can not drill our way out of this problem....
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  •  
    May 22 04:10 PM
    What Ivy league school did you go to? You need a dose of reality. While we get from here to there we need to explore all our areas. It will be a long and difficult journey and just hoping some miracle technology will fall out of the sky to save us just isn't going to happen.
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  •  
    May 22 04:21 PM
    I agree vehicles are the first things that must change and I am a proponent of fuel cell technology myself.
    But what about the dependence on by-products. What will we pave our roads with? Will we have to recycle more of our plastic? Will there still be plastic? And what about jet fuel? I don't want to be the first passenger on the experimental trans-continental flight powered by a mystery fuel source.
    The changes that have to be made because of the extent of our dependence on ANY oil from ANY source are so mind boggling it makes me dizzy. When by products are considered as well, think of all the changes to the infrastructure that will be required.
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  •  
    May 22 05:33 PM
    Monk;
    If we move vehicles off of oil, we will no longer need middle eastern oil. For me this is oil independence. We will still get oil from Canada, and Mexico(#1, and #3 importers). We will still need oil and NG, and we should continue to explore and dig.
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  •  
    May 22 05:39 PM
    People like you anoy me ,because of stupidity . Energy is not for free . People like the author and other liberals seem to think that electric cars are free energy . How do you think electricity is made . Either coal , nuclear or oil which your against . That leaves natural gas which brings up the second idiocy of these people . You have to drill for natural gas which is found with oil . Its not found in your back yard for free . You can't dissociate natural gas from oil . They come from the same place .This is why we have a severe energy problem in america which will probably destroy this country . Stupidity like the verbage presented by the author . Must be a democrat .
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  •  
    May 22 06:25 PM
    Hey surgcare, do you like music? Records evolved into 8 tracks before they evolved into CDs. 8 tracks were shortlived failures but it got people thinking of alternatives didn't it? You have to start somewhere.
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  •  
    May 22 06:36 PM
    Monkdonk, THIS baby boomer is tired of the "I deserve it" generation, where they deserve more than what they earn, they deserve to have everything WE worked for and even more. THIS baby boomer has two self-supporting kids, THIS baby boomer never bought them a big fancy car, and THIS baby boomer is working HER tail off to keep the money coming in so I can retire and not have to work with people like you. The baby boomers are the ones putting money into social security now. Soon we will all be retired and all those jobs will be available, and there aren't enough of you to take on those jobs. Add to that the "I deserve it FREE" group, who will expect you to support them with your taxes.
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  •  
    May 22 07:06 PM
    Yeah, so sorry I hurt your feelings there. Anything important to say about, oh I don't know, OIL??? The actual topic?
    Reply | Link to Comment
  •  
    May 22 07:16 PM
    Like I said the me-me-me generation
    Reply | Link to Comment
  •  
    May 22 07:43 PM
    Being "independant"... from foreign oil means nothing in a free market. The market and demand will determine the price, so even if we were independant, the oil we have would be sold to china or someone else that has the higher dollar for it and our gas would still be high. One thing I was suprised that hasn't come up. The number one consumer of fuel in the USA is OUR MILITARY! Come November, when the democratic party is in the white house, and 150,000 (now unemployed) troups come home, you can expect that oil demand will ease off. You can also expect unemployment to rise, and inflation to take over. I think NOW is the time for investors to look closely at building CNG (compressed natural gas) stations. I recently was looking into a new Honda that runs off of CNG and It has its good points and its bad points, but in the long run I find that it will create a significant competition to oil industries and more car manufaturers will "feel" the demand for this type of vehicle if the CNG stations are already in place. By the way, they also have a way for you to fill your tank in your garage, from the existing natural gas line in your house. That part of this type of infrastructer is already there.

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