There's a new global capital shift that's affecting how to invest in natural gas today for maximum profit.
You see, there was a time when U.S. manufacturing companies invested heavily in the Middle East because of the region's low-cost energy sources.
Today, that money is coming back home.
International companies have noticed that the United States is a cheap source of natural gas. That's because the rise of hydraulic fracturing triggered a boom in U.S. natural gas production.To continue reading click here...
Best Investments in Energy: It's a Race for Profits in the Utica Shale
Find out how you can invest in this hot spot where energy industry honchos are investing billions of dollars.
Prolific U.S. shale regions have delivered some of the best investments in energy over the past few years - and now there's another state set to join the Frackers' Club.
Ohio finds itself sitting atop the deep Utica Shale formation, a source of unconventionally derived oil and natural gas.
In fact, roughly the entire eastern half of the state lies on top of the formation. According to the U.S. Geological Survey (USGS), that portion holds most of the Utica Shale's oil resources.
The natural gas assessment units - land where the USGS believes there to be energy resources - run farther to the north, south, and east of Ohio, going down into West Virginia and Kentucky, across into Maryland, Pennsylvania, and New York and up across the Canadian border into Ontario and Quebec - much of the immense, ancient Appalachian Basin.
How to Find the Best Investments in Shale Oil
Let's start the hunt by looking at where oil production is accelerating the most.
New Arab Spring Could Breed Chaos in the Energy Markets
Investment opportunities in the energy markets always bounce between questions of available supply and prospects for demand.
These days many commentators in the U.S. are viewing excess domestic shale gas and tight oil as a factor in restraining energy prices. Meanwhile, their colleagues in Western Europe forecast continuing economic malaise, translating into a similar result.
Both put forward the position that there is a surplus of oil and gas in a weak global economy, thereby reducing concerns over either supply or price.
I have questioned those premises before here in Money Morning. And I agree that there's no crisis situation emerging any time soon. The prices may not remain as low as some believe, but supply isn't going to be an issue in North America or in the European Union.
But the same can't be said about other parts of the world. And it's this wave of unrest that may have repercussions across the entire energy sector.
Russia: The Greatest Threat to the Energy Markets
As Yogi Berra aptly put it, It's deja vu all over again.
The Soviet gulag state is coming back and this time it could wreak havoc on the world's energy markets.
I began my energy career in Russia. Back then it was part of a sprawling Soviet Union. For the past 23 years there have been 15 independent countries in its place.
But these days it sure feels like the Beatles song from the late 1960s, "Back in the USSR."
You see, many governments aren't able to work out how to plot the global energy sector because it becomes too wrapped up in local political machinations.
And the bigger the energy producer, the bigger the impact is on the global picture.
Three Hidden Water Costs That Promise to Boost Energy Prices
This may sound funny, but water availability is becoming an issue in energy generation. And it may start to impact prices.
The issue here is not the environmental impact of water usage. That is quite a different debate.
What I'm talking about today is the water supply/demand issue.
Because water is plentiful in those areas of the U.S. where shale gas and tight oil drilling is most concentrated, the price of the water itself is very low.
But there are three other costs involved with the usage of water, and those are beginning to cause some serious concerns.
Here's what I mean...
Energy Investors Will Love These New MLPs
The "midstream" segment in oil and gas markets is undergoing some very interesting changes these days.
Remember, these are the companies that connect "upstream" (field production of oil and gas) and "downstream" (refining, processing, wholesale, and retail distribution) functions.
Throughput - moving and storing volume - is the major component of midstream activities, as well as the primary source of revenue. And lots of it.
This market is still the domain of master limited partnerships (MLPs) and other partnership arrangements and used to be primarily populated by pipeline companies.
But the sector is diversifying in an exciting way.
MLP "clones" are starting to emerge, controlling more expanded activities and new product-specific focuses that never existed before.
That means brand-new investing opportunities for you.
The Next Big Change in the Energy Markets
Thoughts are again turning to the next big change in the energy landscape.
As it unfolds, I have been working on how to exploit this trend and will be rolling out my recommendations when I appear at the MoneyShow in Las Vegas next Tuesday and Wednesday.
Of course, before I sketch my new approach to the Caesar's Palace audience, I'll outline it here first. You can expect more on this in coming Money Morning editions.
Today, I want to extend on Saturday's discussion and set the stage for the revisions I will be begin sketching out in my next article.
This is once again about hedging.
The "Hybrid" Approach is a Great New Opportunity for Energy Investors
In places where energy supplies face the most pronounced crunch, they need to integrate energy sources in a more seamless manner.
It's a no-brainer and one element in the "new energy balance" that I have discussed over the past year.
This balance is less about finding a silver bullet (a breakthrough technology) than about finding a more efficient way to combine existing sources.
As this balance works itself out - sculptured by necessity, profit, competition, and innovation -more segmented sources of energy, each satisfying a portion of required demand, will come online.
Instead of looking for a replacement for crude oil, we must find a better way to integrate the entire energy spectrum to satisfy this new energy balance.
The most basic part of this is an ability to exchange energy sources, thereby enabling users to offset supply problems or availability considerations by rapidly exchanging sources. Certainly, some bottlenecks will exist in this process, and, in some cases, the balance remains elusive.
But where the process is already underway, there's a great opportunity for investors.
How to Play by the Rules and Beat the Tax Man with MLPs
Paying taxes is about a pleasurable as a root canal. It's hard not to think about all that money going bye bye.
But it's inevitable and there's nothing we can really do about it, I guess.
However, tax day does bring to mind something quite a bit more positive: Like how to make money in the energy sector.
Actually, that's not as much of a stretch as you might think. Â That's because the bridges are already in place between how taxes are paid and energy returns.
Right about now, some of you are probably thinking I will start talking about energy sources like renewables that survive on government tax concessions.
Or perhaps you might think this is going to be a discussion of tax write offs for certain field projects that utilize public land.
And unless you are prone to the more fanciful, your thoughts should not be wandering toward squirreling money away on a small island somewhere.Â Â
Because there has been a much more practical approach that's been generating success for a while now.
This is how you play by the rules and still beat the taxman in Washington.