6 ways to profit from Peak Oil

[Bishopknight]

Interesting Yahoo Finance article with video

From personally studying Peak Oil, I can attest his observations are right in line with everything I've found.

http://finance.yahoo.com/tech-ticker/article/11442/6-Ways-to-Profit-from-'Peak-Oil'?tickers=PBR,CNQ,ECA,SU,NXY,XOM,CVX

This other article from Yahoo finance isnt particularly optimistic either, Warren Buffets investment strategies for the coming decade

http://finance.yahoo.com/tech-ticker/article/12050/Buffett-Soros-Betting-on-Biotech-'End-of-the-World'-Plays?tickers=GSK,SNY,MAPP,SVNT,JNJ,GENZ,BRK-B

[peternap]

That's interesting Bishop but I've heard the same thing before. I own a few small oil stocks and they aren't doing much, haven't for years. Oil may be the single item that breaks this country.

Instead of oil, I've invested heavily in alternate energy, especially Solar. Before I sold and later rebought, I made an 800% profit on ASTI. It's moving back up again and I have an even bigger stake now.

Your timing is good since  I just got back from a 600.00 fuel run. Even farm diesel is costing me 3.69 gal and of course... :-\I wouldn't dream of running that in my truck. Road diesel is 4.05.

We will have to cut our fuel costs somehow. My Whizzer takes a lot of miles off the Green Hornet (Truck) and my Focus (40mpg) saves a lot of miles for my wifes Yuppie Truck (land Rover).

We just have to cut back and start using things that work. The oil companies and the Government can stuff it.

[ScottA]

Interesting that since the price of oil has shot up they are suddenly finding new deposits such as offshore brazil most recently and north dakota and even in pennsylvania.

[muldoon]

Nothing really interesting about them, nor about the Dakota find, nor the tar sands of Canada streaming down to Colorado, nor the vast fields still untapped off the coast of Florida, the Virginias, and California.  The huge fields in gulf of mexico have been known about since the 90s.  What is new about these fields is that $115 oil now makes it profitable to get those hydrocarbons from the ground.  In the 90's when oil was 12 a barrel those fields were known about - but there was no way possible to extract them and make a profit.  Most ventures today are closing in a $60 barrel break even which were not possible before. 

While oil ABSOLUTELY is a finite resource and the fundamentals around peak oil are real, there is no real shortage of oil today.  We have more than enough proven reserves on the planet for decades, there are vastly more unproven but speculated.  What we do have is a lack of cheap oil.  The days of sinking a 3000 foot well in west texas and collecting royalties for life are long gone.  Now getting those fuels requires dealing with subsea, subsalt, deepwater, tar, heavy/sulfur crude.  Those heavy or sour oils take significantly increased processing in thw cat cracking process.  There are only 2-3 plants in the country that can even process them at all.  Hell the biggest one is BP Texas City - it's been offline since hurricane rita/and before that March 2005 with the explosion.  It's expensive to move that product, even if we have known about it for decades. 

That being said, there is a huge mis-perception out there about who controls the oil on this planet and how the exploration and production game is being played.  I mean, the 5 big oil companies (the supermajors) combined own less than 13% of the reserves.  85% is owned by nationlized oil companies.. mostly russia, venezuala, pemex, uae, iran, saudi arabia, etc...  The OPEC countries make up 72% of that number.  People should at least know who it is thats ****ing them.... 

My own oil play is simple, get off of it.  Use sustainable building products and lifestyle choices where you can.  Do not be dependent, position yourself to deal with (and if you like profit from) the increased energy costs.  Things like railways will resurface for transit, food and produce located 100miles from you will be a good industry,  as prices increase no one will ship oranges from florida to california, or avacadoes from california to new york.  If there are investment opportunities in the localized community to be part of this shift, I would read the business plan for sure.  I think solar is a great investment - mostly because of the speculative power - its what everyone thinks of when they think about investing in green companies and they have gotten a great ride from it.  Long term, I think solar is just a small part of a larger solution. 

[peternap]

My own oil play is simple, get off of it.  Use sustainable building products and lifestyle choices where you can.  Do not be dependent, position yourself to deal with (and if you like profit from) the increased energy costs.  Things like railways will resurface for transit, food and produce located 100miles from you will be a good industry,  as prices increase no one will ship oranges from florida to california, or avacadoes from california to new york.  If there are investment opportunities in the localized community to be part of this shift, I would read the business plan for sure.  I think solar is a great investment - mostly because of the speculative power - its what everyone thinks of when they think about investing in green companies and they have gotten a great ride from it.  Long term, I think solar is just a small part of a larger solution.


I like your play. I also agree that in THIS country, solar will be a small part for a good while. Europe is another thing. ASTI has signed contracts with several overseas builders and material suppliers because of code changes. Germany for instance, requires all new buildings have sustainable power built in. Norisk Hydro
has bought approximately 1/3 interest in Ascent so they can incorporate the new technology into their aluminum building materials.

I've been playing with wind and hydro and may get it right soon. Larry is on the same path as is Glenn and Don and several others here. I'm certain I live quite nicely off grid now....and the technology keeps getting better.

I have said this before but...this country is one big slip from collapsing. Just imagine what will happen if food reaches the point that Uncle Sam cuts off food stamps.
Everything is tied together!

[benevolance]

well with rising fuel costs and arid conditions in America the price of food has skyrocketed and several developing nations are starving... there are riots and many other countries will have turmoil and upheaval over a lack of food.

Corn for ethanol based fuel is a dumb, dumb idea when 1/4 of the world lacks adequate nourishment... But the price of food is the second dangerous marker for economic out of control inflation..

We have oil fastly approaching $125 a barrel and we have food spiraling out of control... The rest of the economic sector will soon catch up...And thus we will be on the way to double digit inflation...

With the debt to income ratio of americans and America...We cannot hope to survive such a crisis unscathed... Those that can live off grid and grow enough food to feed themselves will be fine...Everyone else is going to have to tighten their belts and see theor ay of life changed and or reduced.

[ScottA]

Bleak predictions but I belive higher prices will lead to higher production which will balance things out. Will we see prices go down? Not likely. But they won't go much higher either. This ofcourse assumes a free market will be allowed to operate. If Bushco inc. tampers with it anything is possible.

[benevolance]

there is a lot of oil out there untapped...But... the higher the prices go... the faster that prices rise the more trouble it causes the world due to inflation ...etc...

So yes there are deep sea wells to drill and there is the tar sands and shale oil fields to mine... this is costly oil and as we grow more dependent upon it the prices will spike higher and higher.

Also countries that are not very USA friendly like Venezuela Iran Libya... are going to make a mint when oil is at $125 a barrel

[Bishopknight]

Its all very concerning to me. I think Muldoon has the right idea, lessening dependence on oil. I'm certainly following that path and many here are too. Thats why I like this forum so much, many intelligent like minded individuals.

With food rationing now starting at Costco in certain parts of the country, I think more and more people are awakening to the just-in-time deliveries our supermarkets depend on to run smoothly.

[glenn kangiser]

Just in time is a disaster in the making.  Most of the new stores I work on have no storage area other than what you see or at least very little in the back. 

Economy burp = no food in the cities after about 3 days or if a panic ensues, 1 day.  Look for riots to immediately follow.

Contrary to what most want to believe, people are really not that civilized and the ones who try to be are already done for.

[benevolance]

well I grew up in the woods man...no snow plow on the main road meant days without access to a store...my dad is ready for WWIII I am not joking...He always has a side of Pork in the Freezer.. with Generators and fuel... and there is always enough canned goods to last a family of 4 a month... it is crazy...

My wife makes fun of me because there are shelves full of canned goods...And the freezer is always full... So there is enough food in the pantry to last for weeks... i am not as bad as my dad... but I like to keep the cupboards well stocked

When beans are on sale I buy a dozen cans....same with canned milk or corned beef...etc..oatmeal, crackers...

If everyone had a week's supply of food at home there would be no panic after a storm or disaster... we could just muddle through with what we have to eat at our homes.

[peternap]

I don't feel too sorry for city people.
I keep reading about the shortages of rice. Rice is an almost perfect food but corn is good too. Run down to tractor supply. You can buy 200 pounds of corn for about 35 bucks.

I buy at least that every week for the deer feeders. wash it, soak it or grind it and it's just as good as any corm.

They still have plenty of the large sizes of peanut butter in Costco. Very healthy and an unlimited shelf life. They still have plenty of honey. Again, unlimited shelf life.

[ScottA]

I try to keep about a 2 week supply of food in the house. The only exception would be fresh milk and eggs which get used up weekly. I've been thinking lately of stocking up on canned goods to add another week or so to the stocks.

[benevolance]

And yes the point about Peanut butter is a good one...

We keep lots of it on hand... as well as honey and molasses... all which can last for years...And all of it is good for you.. a little sugar in molasses... but lots of energy... Peanut butter and honey are close to being perfect foods..

if there was a disaster you could use up the fresh milk in the house to make bread... which with something like peanut butter honey or molasses could feed the family for days... Yeah I know you might get sick of eating the same thing for 3 days... but to have something that good for you.. and that tasty while other people are running riot burning down grocery stores for something to eat... It is not a bad way to get by

[peternap]

I'm going to pick up a few more 55 gal drums at 2:30.
I don't see the price of diesel doing anything but going up for the next few months.

[muldoon]

The rice rationing thing from costco has alot of people very concerned.  It concerns me too, but perhaps not for the same reasons.  At this point I think it is safe to assume that in the US we have ample supply of food today.  Our distribution systems are lacking, and with continually increasing diesel shippers are constantly being rescheduled and re-prioritized.  What is very likely a simple logistical problem and not a true shortage today could blowup overnight.  If say even just 3% of the country were to hear that and respond then they will go out and start stocking up.  This in turn causes further shortages, especially on the things no one buys in a "normal" shopping trip like canned beans and bulk rice.  Once those hit suddenly theres a panic, and things go overboard as the pendulum swings far to the other side. 

I saw this last year in hops, an ingrediant for brewing beer.  There was a warehouse fire and alot of last years crop went with it.  Still plenty left but some supply chain problems.  Suddenly every small brewery was afraid of not being able to procure necessary ingrediants for business and made some comments and huge orders.  The every home brweer in the US caught wind of it and decided they suddenly needed to secure a years worth of hops.  People who never purchased more than 2 ounces were trying to buy 5-10 pounds.  Prices of the Cs went from $2 an ounce to $30 an ounce in 2 weeks, if you could find it at all.  Still hasn't really recovered, rhyzomes business was off the charts this year.  Very few people brew their own beer, very few people own breweries, but the psychology is there.  If panic starts in the general public, all bets are off. 

Personally, I think the right target is 2 months food & water stocks.  I wouldnt tell that to my neighbor in the city though because first he might panic at the thought, and two he might think that I have it if he ever needed it which could be dangerous for both of us.  Not sure what my point is with that, we sure do live in interesting times. 

[peternap]

Even the fuel thing is getting attention. I just got 320 gallons of farm diesel and they are watching to see if it goes in the truck or barrels.

[gandalfthegrey]

I try to keep about a 2 week supply of food in the house. The only exception would be fresh milk and eggs which get used up weekly. I've been thinking lately of stocking up on canned goods to add another week or so to the stocks.

I live out of town so I need to stock up every other week or so.  My wife also discovered food for sale at Amazon.com.   She buys by the case and over $25 ships for free.  Also you can have a standing order that is reshipped every 3 months.  I actually believe you can set the shipping to your needs.  It works fine so far.  (no perrishables)....

[MountainDon]

amazon carries a lot of stuff that you might not think of looking there for.

Depending on how much business you do with amazon in a year their "Prime" membership might be worth a look at. I believe it's still $80 a year. For that you get free 2 day shipping on anything amazon themselves sells. None of the companies with amazon storefronts. No minimum size on the order either. It's also possible to share the membership with a few friends and family at no extra cost to anyone.

Just FYI