Weekend: Is an Oil Supply Crunch Ahead?

Energy and Capital's Weekend Edition

By
Sunday, June 19th, 2011

Welcome to the Energy and Capital Weekend Edition — our insights from the week in investing and links to our most-read Energy and Capital and sister publication articles.


The stark warnings from the IEA were loud and clear:

 

Unless OPEC increases production, supplies may become “very tight” and will be unable to meet global demand.

Unfortunately, Kuwait and the Saudis are most likely the only OPEC members supporting the increase. Then again, that makes perfect sense.

Take Libya: On Thursday, the IEA reported oil production had fallen below 200,000 barrels per day. Prior to the uprisings, the country was pumping out 1.6 million barrels per day. And don't think things will change for the better...

The IEA also mentioned this week that Libya will be unable to return its production to that 1.6 million b/d levels until 2014.

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How bad is it getting out there?

The world consumed about 86.7 million barrels of oil every day during 2010. Very soon, we'll be over 90 million barrels per day. The IEA even expects global demand to reach 95.3 million barrels per day within the next five years.

Things have gotten so tight in China that diesel exports leaving the country were suspended last month. They're trying to conserve as much as possible.

The IEA reported approximately 41% of the world's demand increase between now and 2016 will come from China. Much of the rest of that increase is expected to come from the rest of Asia and the Middle East.

Of course, we can't leave our own crude addiction in the dark. As you can see below, our demand is heading higher, too:

US oil consumption 6-18

Investors With More Options

Even throughout this volatile market correction, investors have more options than just your typical stock trade.

So where can investors turn?

My colleague Ian Cooper and his readers have been making gains hand over fist — something most investors only dream of during this correction.  And they're not doing it with stocks. They're doing it by trading options. 

The reason most investors don't trade options is simply because they don't understand how to do it. Take it from me, it's much easier than you might first believe...

Take a moment to watch how Ian simplifies the entire process for the average investor.

Enjoy your weekend,

keith kohl

Keith Kohl
Editor, Energy and Capital

P.S. Below, you'll find some of this week's best investment stories from the pages of Energy and Capital and our sister publications.

Taking China Beyond Oil: Technology that Big Oil Wants to Keep Hush-hush
All it took was one 23-minute long presentation by Chinese researcher Henry Chiang that had an astounding conclusion: solar power at night! Editor Nick Hodge's latest investment webinar explains how this new technology is breaking into Big Oil's profits. 

1,033% Gains and Growing: Soviet's Fateful Oil Blunder
It's considered one of the worst blunders in Soviet history. Decades ago, they discovered a massive oil field in Mongolia... and then failed to develop it. Billions of barrels of untapped oil were lost... until now. Christian DeHaemer has found one tiny company that's churning enormous oil profits — and explains how you can get a piece of the action.

But We Don't Have Another 9.48 Million Barrels: Great Recession 2.0 or $150 Oil?
U.S. crude stockpiles are down; demand already outstrips supply, and the IEA says a tidal wave of emerging market refineries is coming online and will demand to be fed... Where will the world get its oil? Chris DeHaemer tells readers the two places that will supply the globe with crude in the years to come, and how you can profit.

Failing Jobs Poison Retail's Soup: What to Do When the Truth Slams Through Your Shopping Center's Doors
Adam Lass shows you how to leverage the collapse of the "Great Obama Boom".

New Ways to Top Natural Gas Profits: The Bullish Outlook on Natural Gas
Editor Keith Kohl reveals a new way for investors to take advantage of the IEA's bullish outlook on natural gas.

Pentagon: Oil Supply Disruption Plausible and Likely: The Transition to Renewables Begins
"The realities of global oil markets mean a disruption of oil supplies is plausible and increasingly likely in the coming decades." — Pentagon Operation Energy Report

Four Key Drivers in China's Gold Future: China's Gold Demand to More than Double
Given the increasing prosperity in the world's most populous country, Wealth Daily Analyst Luke Burgess tells investors all signs point to increasing gold demand in China.

Using Options to Invest in Energy: A Better Way to Buy Stocks
If you're like I was when I began investing, you're splitting the few investment dollars you have into the handful of stocks you think will go higher. That's what I used to do before I found a better way... and that's what millions of Americans still do.

The U.S. Has Defaulted: How to Profit from the End of the Dollar
Christian DeHaemer tells you how to profit from the ongoing default by the U.S. government.

6 Alternative Energy Stocks that Could Double: Only An Idiot Would Buy These Alternative Energy Stocks
Editor Jeff Siegel reveals 6 alternative energy stocks to buy before the next rebound.

Marcellus Shale Bulls: What's Goldman Up to This Time?
Analyst Ian Cooper questions Goldman Sachs' latest forecast, uncovers the latest and most exciting Marcellus exploratory news, and offers readers two simple ways to profit from the nat gas boom.

Nickel Prices to Drop: Nickel Will Fall Victim to Oversupply
Analyst Luke Burgess tells investors the price of nickel may be headed south as an oversupply threatens to flow the market with the white metal.


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