Category — Energy

One of the buzzwords at this week’s Australian Petroleum Producer and Explorer Association (APPEA) conference is ‘Shale’.

And specifically, shale gas.

If you’re not familiar with it, shale gas is gas that’s trapped within deep shale rock formations. Until recently, it was almost impossible to recover this gas.

But technological advances mean natural gas companies can now access this gas. To the extent that it’s now revolutionizing the energy world right before your eyes.

Over the last six months, energy stocks have been some of the best performers in the stock market.

With good reason – global energy demand is set to keep soaring.

As I mentioned in yesterday’s Money Morning, the International energy Agency (IEA) estimates global energy demand will increase by ONE THIRD in the next 25 years.

So to get the ‘good oil’ on the oil and gas sector, I’m in Adelaide to join 3000 other delegates for the Australian Petroleum Production and Exploration Association (APPEA) annual conference.

It’s a pretty heavyweight conference…

We heard from the International Energy Agency (IEA).

Federal and State politicians have weighed in. [Read more →]

Without supplies – whether it’s energy or food – a nation and its economy will quickly collapse.

We’ve see it proven time and again through history.
Whether it’s World Wars I and II, the Punic Wars, the Napoleonic Wars, Middle East wars, or the U.S. Revolutionary and Civil Wars, if you control the supply lines, you control the war and its outcome.

The Europeans know this more than anyone else.

Throughout history, barely a decade passes without one European state declaring war on another…or a civil war or revolution tearing a nation apart.

So, it’s essential to secure supply lines. [Read more →]

The oil and gas world meets in Australia this week.

Today and for the next two days I’m at the 50^th annual get-together for APPEA – that’s the ‘Australian Petroleum Producer and Explorer Association’.

I packed my bags and kissed the family goodbye last night to fly up here for this year’s conference. It’s a busy day ahead and I’ll tell you more about it tomorrow.

But this morning I just wanted to give you a heads up on the key issues driving the global energy market…what they mean for Australia…and most importantly what they mean for you…

With over 3000 delegates meeting at Adelaide’s Convention Centre it’s by far Australia’s biggest oil and gas conference.

No wonder it was so hard to find a hotel room! [Read more →]

The search for oil in the Arctic Circle – on ‘the roof of the world’ got more serious.

Over the weekend, Norway’s Statoil ASA (NYSE:STO) signed a massive exploration deal with Russian behemoth Rosneft in a venture that may require more than $100 billion in investment over the next few decades.

Specifically, the company is aiming to help Rosneft develop untapped oil resources in the Arctic, as Moscow struggles to gain a competitive advantage given declining conventional oil and gas production in Eastern Siberia.

The deal highlights a number of key issues for both companies and for Moscow moving forward.

For Russia, some of its most mature conventional oil basins are declining in output rapidly, at a pace that could reach 8% a year within this decade. With production waning and concerns about long-term supplies accelerating, Russia has no choice but to venture into the north. [Read more →]

Friday, the price of West Texas Intermediate (WTI) crude, the benchmark oil contract traded on the NYMEX, fell 4% ($4.14). The one-day decline is the steepest since WTI fell 5.1% ($5.12) on January 3.

The other major benchmark, London-set Brent, also was hit, but less significantly, falling 2.6%. It was the largest Brent decline since a 4.6% dive on December 14.

However, the Brent-WTI spread is now increasing again. As of the close on Friday, the spread as a percentage of the WTI price (the better way of looking at it) stood at 14.9%, the highest differential in more than two weeks.

Two important questions follow.

First, why did this happen? Second, what is that spread again telling us?

The answers will surprise you. [Read more →]

You may think Europe is the last place you should invest.

If you think that, you’re wrong.

The European economy is in a huge hole and there’s only one way to get out of it…

In fact, in the latest Australian Small-Cap Investigator, we argue that some of 2012?s biggest gains could come from Europe. And one industry in particular…

The Commodities Bull Market: Insights on Energy and Agriculture
By Peter Krauth, Global Resources Specialist, Money Morning (USA)

Despite the setback caused by the 2008 financial crisis, the commodities bull market rolls on. A short four years later, many commodities are trading at or near all-time highs.

And thanks to huge swaths of the developing world moving up the ranks, the current bull market in commodities promises to be one for the history books– both in time and size.

After all, the wants and needs of 7 billion people are an irresistible and monumental force.

Soon virtually every substance vital to modern life will become enormously expensive ? and profitable for investors who know how to play it.

In fact, today’s scarcity and soaring costs could spur history’s biggest gains. [Read more →]

Russia controls the European natural gas market. The map below shows the gas pipelines running from Russia, into Western Europe, and South and East Asia:

Click here to enlarge

For years, Europe has been at the mercy of Russian natural gas suppliers. And in 2006, Europe bore the brunt of a pricing dispute when Russia simply turned the gas off. Nothing flowed through the pipes.
Again, in 2009, Russia switched off the flow of natural gas, but this time, only to the Ukraine over another pricing dispute. Other parts of Europe received limited amounts of natural gas.

And just to prove a point, in February – in the middle of a cold snap during a mild northern winter – the Russian state-owned gas company, Gazprom decided that it would only supply the amount of natural gas it was contractually bound to. [Read more →]

Natural gas has been described as the ‘fuel of the future’. But it’s not behaving like it.

Prices in the key US market have plunged by 75% in the last four years. And they’re still falling. In 2012 alone, natural gas futures have dropped by 35%.

That’s been welcome news for American consumers. But from an investment point of view, does it mean that natural gas has now become a busted flush?

Far from it. In fact, now is the right time to position your portfolio for a recovery.