Peak Fossil Energy

Tom Konrad CFA Four new stock lists for different approaches to profit from peak oil.   As I've researched and written this series on ways to invest in companies that will profit from peak oil, I've been greatly expanding the number of stocks in our old "Clean Transportation" stock list, at the same time I've been doing a lot of thinking about how these companies will fare.  Because of this, I've decided to split Clean Transportation into four groups of similar companies, depending on how they are working to reduce our dependence on oil. The new stock categories...

Tom Konrad CFA Bargain hunters looking for opportunities in muni bonds should be mindful of peak oil. Meredith Whitney predicts a wave of defaults in municipal (muni) bonds, followed by indiscriminate selling and potential buying opportunities for some.  She's been widely criticized for the prediction of defaults, but I'm a lot more interested in the prediction of the market's reaction.  With tax-free, AAA-rated munis currently yielding more than comparable taxable Treasury bonds, they seem at least a relative bargain already.  I would not call it outright panic, but I'd expect there are be some bargains...

by Tom Konrad, Ph.D.   A couple years ago, I began to see reports that coal supplies might not last the 200+ years we've all been lead to believe, so I wrote an article about what you could do to prepare your portfolio for Peak Coal. Now two years have passed, and Peak Coal is undeniably 2 years closer.  (Did you ever wonder why people who have been saying that we have 200 years of coal for 20 years aren't now talking about 180 years of coal?)  But more than being 2 years closer, the evidence continues to mount.  Caltech...

Tom Konrad CFA Part Subject / Description Stocks mentioned I Biofuels Overview WM II Hydrogen Vehicles and Vehicle Electrification III Natural Gas Vehicles WPRT, CLNE, and one I missed: FSYS IV Synthetic fuels: Gas-to-Liquids, Coal-to-Liquids, and Biomass-to-Liquids SSL, SYNM, RTK V Biofuel from Algae GSPI.PK, OOIL.OB, PALG.OB, PSUD.PK VI Barriers to Alternative Fuels ...

Tom Konrad CFA There are two types of solutions to the liquid fuels scarcity caused by stagnating (and eventually falling) oil supplies combined with growing demand in emerging economies.  The most obvious is to find a substitute to replace oil.  Supply constraints limit the full replacement of oil by most potential substitutes.  Understanding those constraints leads us to the investment opportunities that arise from these substitutes.  Increasing demand and constrained supply of oil is fueling the search for oil substitutes to use in its place.  Unfortunately, almost all of these potential substitutes also have limited...

John Petersen On August 27th, we'll celebrate the 150th anniversary of Colonel Edwin Drake's completion of the world's first successful oil well near Titusville, Pennsylvania. That discovery and the many that followed planted the seeds of an industrial, economic and cultural revolution that transformed America from an agrarian backwater into a global superpower. For the next 114 years, oil was cheap, plentiful and the solid bedrock of the American Dream. Since the early '70s, however, the dream has gradually become a nightmare as domestic and global oil production began an irreversible decline. My first graph comes...

Tom Konrad CFA The best four stocks I've found in my six month quest to find the best peak oil investments. I apologize for being a tease.  Since March, I've been writing this series I've called "The Best Peak Oil Investments," but in many cases what I've actually done is to warn readers to stay away from particular sectors.  This bait-and-switch was compounded for my syndicated readers at Seeking Alpha when their editors decided to re-title the early articles in this series "Peak Oil Investments I'm Putting My Money On."  If you've stuck...

Charles Morand Peak Oil is a term that has become common currency in energy debates in last three years, due in large part to the spectacular rise in the price of crude between 2005 and the end of 2008. But what does Peak Oil actually mean and, more importantly, what do I mean when I use it in my articles? In the purest and original sense of the term, Peak Oil refers to the point in time at which the rate of oil production (as measured, for instance, in barrels per day) peaks. This peak,...

Charles Morand The relationship - or lack thereof - between oil prices and the performance of alt energy stocks has been a long-time interest of mine. I discussed it last in late March when I looked at correlations between the daily returns of alt energy and fossil energy ETFs. At the time, I found that only a weak relationship existed between the two and that if someone wanted to make a thematic investment play on Peak Oil, alt energy ETFs were not an ideal way to do so.  Seeing as the popular press and countless "experts"...

The recent slump in the price of energy commodities that has accompanied slumps in the rest of the market has reignited an old debate: to what extent is the performance of alt energy companies (and their stock prices) linked to fossil energy prices? People who argue that the two are closely connected implicitly believe that policy-makers and other important economic actors view alt energy mainly as a hedge against high energy prices, and therefore believe that a drop in fossil energy costs will result in a fall from grace for alt energy (there is evidence that at least...

John Petersen Generation specific cultural references can be treacherous ground for bloggers because the flashback effect is usually limited to readers with long and vivid memories. In this case, however, the lessons of history are so relevant that I'll accept the risk and offer some context for younger readers. In my youth a war wrapped in the liberal ideology of the Kennedy and Johnson administrations and fueled by an underlying concern over who would control oil and gas resources in the Gulf of Tonkin was fought in the jungles of Vietnam, Laos and Cambodia. By current standards,...

Tom Konrad CFA Dr. Arthur Berman, of Labyrinth Consulting Services has taken a hard look at actual production data from  Barnett Shale in 2007.  What he found should worry anyone expecting this abundant, relatively clean, domestic energy resource to be cheap.  It should especially worry investors in shale gas companies, such as CHK, DVN, and XTO. In a panel entitled "Natural Gas Game Changers?" at the 2009 International Peak Oil Conference, Dr. Breman presented some results from his research into the actual production from the nearly 2000 horizontal gas wells drilled in the Barnett Shale in 2007.  The Oil...

Tom Konrad CFA Photo: Robin Lucas, via Wikimedia Commo With friends like these, who needs enemies? The Sierra Club is fighting new Liquified Natural Gas (LNG) export terminals, because they believe LNG exports would reward and encourage producers of shale gas. Fighting shale gas has blinded them to the bigger picture. If LNG exports were to reward shale gas producers, they would have to be significant enough to raise the price of domestic natural gas. Such large exports would also lower...

No peak demand Eamon Keane "So much for peak demand - try 134mb/d by 2030."  That was the startling conclusion dispatched from the ivory tower recently by Joyce Dargay, a British transport econometrics professor, and Dermot Gately, an American economics professor. I'll present their conclusions and then discuss the implications. Their report is available here (pdf). The main conclusion is that the low hanging oil fruit has already been picked after the 1970's oil shocks. From 1978-85 OECD fuel oil consumption dropped by 7mb/d and then from 2003-2008 by another 2mb/d. The...

Bill Paul Will shares of the oil companies that are major players in Canada’s tar sands region rise or fall? Logically, shares should rise in the wake of the deepwater drilling moratorium ordered by President Obama following the BP (BP) oil spill, as Wall Street begins to reflect on the fact that Alberta’s tar sands region is the second biggest crude-oil deposit in the world. Even before the spill, a report from IHS CERA had concluded that Canadian tar sands would be the single biggest source of US crude imports in 2010. Just as logically, however, shares should...