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A Tale of Two Revolutions

More than two decades have passed, but folks who were there for the story I’m about to share with you still remember it as “The Revolution That Wasn’t.”

Let me share the tale with you and explain the lesson that it teaches.

Then we’ll show you a specific way to apply that lesson for a hefty profit.

First the story…

  • Featured Story

    Oil Forecast: The "Syrian Premium" Is Not Temporary

    By an apparent agreement to place its chemical weapons under international control, Syria seems to have dodged an imminent American military attack. Yet even as the world takes a step back from the brink, three critical questions still remain: 1. Will Syrian President Bashar Assad hand over all of his chemical weapons? 2. Will the proposed international control mechanisms satisfy Washington? 3. Will the final result contained in the U.N. report on the chemical weapons use outside of Damascus alter the outcome? Of course, until the latest news hit, one result had seemed certain: The global oil market was bracing for higher prices. West Texas Intermediate (WTI) closed at a 28-month high on Friday, while Brent crossed the $116 a barrel level. Following the agreement, that trend has reversed, sending oil prices in both New York and London lower. But has this crisis really been defused? Just look at oil prices, and where they're undoubtedly headed......
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  • oil forecast

  • A 795,000 Mile Long Pipeline to Big Energy Profits Right now nearly 70% of the existing energy pipelines in the U.S. are more than 35 years old. They will need to be replaced - and soon. That means these specialty companies are about to pop in a big way. Read More...
  • Don't Ignore This Shift in the Global Oil Market The prices for crude oil and major oil products (like gasoline, diesel, jet fuel, and heating oil) continue to advance. And some interesting changes on the supply side are emerging.

    You see, traditional raw material providers are moving to supply international markets with value-added processed products.

    Russia is the clearest example of this transformation in the oil-export balance, but it's hardly the only one. Saudi Arabia and Kuwait have also embarked on major refinery upgrades and expansions.

    The Russian experience is the most... Read More...
  • This Key Energy Metric Could Make You A Lot of Money Last week I discussed what EROEI is-and how to use it.

    This week I'd like to talk about how this key metric affects the balance of your energy investment portfolio.

    Now, this is certainly not the only element in determining preferable stock moves, but it's critical that you know the EROEI because it could make you a lot of money.

    Recognizing the real elements that determine the genuine cost of energy production, EROEI is becoming an important factor in estimating profit margins.

    And those margins certainly influence the performance of a stock as we've seen all across the energy value chain in recent months.

    EROEI refers to the amount of energy used to produce energy.

    If this ratio produces a figure of 1.0, EROEI is telling us that it takes one barrel of oil equivalent to produce one barrel as a result.

    Anything under 1.0 means that more energy is consumed in the production process than is gained as an end product.

    EROEI has the advantage of being a useful yardstick throughout the energy curve - from upstream production sites (wellheads, generating facilities) through midstream (gathering, transit, storage and initial processing) to downstream (refineries, terminals, wholesale and retail distribution, end use).

    Some applications of EROEI are already in wide usage, although we don't tend to think about them in these terms. Energy-efficiency ratings on appliances, heating and cooling systems, windows, or building supplies are an application at the end of the energy curve.

    But how can we use this to fine-tune an investment portfolio?

    To continue reading, please click here...
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  • The Trajectory is for Oil Prices to Rise Crude oil and gasoline futures contract prices moved down yesterday, as the market took a breather from an accelerated upturn.

    But the overall medium-term trajectory for oil prices no longer appears to be in doubt.

    As I have indicated on several occasions recently, the downward movement in May and June was an overreaction to softness in the sector, with the ultimate slide over twice as large as any objective reading of the fundamentals would justify.

    We are now witnessing a return to a "normal" oil market. That doesn't mean a lack of volatility or a narrow range of trading.

    This normal is hardly boring.

    These Three Factors Determine Oil Prices

    What it does mean is that oil prices will be determined by three factors:

    1. Supply and demand;
    2. The spread between benchmark crude grades; and
    3. Geopolitical tensions and events. Here, we are considering matters we've discussed here a number of times.
    Now we will continue to see, on occasion, external factors weighing in, such as the concerns about the European debt crisis that pushed the markets lower yesterday.

    That results in something I have discussed previously - a sort of "cart leading the horse."

    To continue reading, please click here... Read More...
  • Four Things Suppressing Crude Oil Prices Today The collapse of talks between Iran and the "Big 6" (the five permanent members of the UN Security Council plus Germany) should have accelerated international crude oil prices.

    And yes, they are higher.

    But the real spike hasn't hit. Not yet.

    The rising crisis atmosphere in the region and the genuine possibility that a fourth round of talks between the two sides will not even take place should have renewed the upward movement.

    That hasn't taken place yet, either.

    Oil prices are caught between the normal dynamics of geopolitical concerns - which push prices north - and continuing concerns over a global economic slowdown - which results in lowering expectations.

    Now, this limbo is a delicate balance; it could change in a matter of hours.

    We are likely to see a short-term rise Monday evening if the Norwegian oil and gas sector strike is not averted. Labor negotiations between Norway's oil workers and employers over pay and pensions failed - yet again - yesterday. The country is now just hours away from the first complete shutdown of its oil industry in decades. (Already, the strike has cut oil output by 13%, according to Reuters.)

    Then there are the figures coming out from the Energy Information Administration (EIA) on Wednesday, which will almost certainly show a drawdown on U.S. inventories. Normally, that would also push up prices.

    However, absent an Iranian move against the Strait of Hormuz or a major refinery accident somewhere in the world, the rise will be less than usual.

    That's because right now, four things are tempering the oil price rise:

    To continue reading, please click here... Read More...