greeytop

Why I'm Not Buying Oil's Recent 'Correction'

I have to support the viewpoint of Fitzman. I have been investing in all kinds of energy for more than 30 years. The recent high price of motor fuel has, indeed, led to destruction of demand but the easiest consumption changes were made first. Further reduction in consumption is going to be harder. As long as economies in the rest of the world are roaring, our consumption cuts merely make more of a scarce resource available for "them" to consume. Most members of Congress are profoundly stupid but most of the people running the oil companies are very realistic.(note the comments of "4th.generation oily") Oil and gas men have seen real hardship before. One oil major I am invested in is also producing energy from solar, geo-thermal, and is researching producing liquid fuels from biological processes. The easy oil and gas has mostly been exploited.The recent price of energy stocks has had an element of speculation. Speculators are like vultures who show up when they see a dead or dying critter on the ground. They vanish when the body is gone. I believe there is even a modicum of "hot money" in something as pedestrian as an electric utility. The moment some rumor comes along, they cut and run and cause the price to drop. I would argue that we may be making serious amounts of motor fuel from coal to liquids before hydrogen or other esoteric solutions appear. Electric cars may own a fraction of the market ( think mail delivery, short range commuting etc.) But I don't see electrics allowing you to drive from Jacksonville, Florida to Detroit. Oil and gas will be with us as long as we can squeeze it from the Earth.