This is no BS.
This is not something to take lightly. This is for real. Westerners, specifically Americans are so self-centered that they have no clue that the biggest war in the history of the world has already begun.
Wake up America. The energy war has started. Here is a quote from the front page of UK's Gaurdian,
"Recognising the danger, Gernot Erler, Germany's deputy foreign minister, said yesterday: "We are seeing desperate measures by Asian countries, mainly China, India and others, to get hold of energy resources, and for them Iran is a partner they can't do without."
This is of course in reference to potential UN sanctions against Iran for their nuclear program. The important issue here is not Iran's quest for nuclear development but China, India and other Asian countries 'Desperate Measures' to secure energy resources.
America uses 25% of the world's energy resources. There is no longer enough to go around. The American lifestyle is in danger of a radical decline over the next decade.
As I told readers to my premium service, 80% of the world's oil is controlled by Governments. As the energy crisis becomes critical these Governments will turn off the spigots and hoard oil.
Prices will skyrocket well beyond anyone's expectations.
Westerners think they have a right to the world's oil. They will soon find out that not only do they not have any right to it but that China, India and the rest of Asia have quietly acquired those rights.
The next 5 to 10 years will see radical changes. At the center of those changes will be energy and specifically oil. The war has begun. At this point it is still unobtrusive but one day in the next decade it will be in your face and in your life.
You can deal with reality... or reality will deal with you. It's your decision.
Now before I get into the positives of this (the investment positives), I want to draw your attention to an excerpt from an article in today's The Independent:
"At the annual summit of the Organisation of the Petroleum Exporting Countries (Opec) in December, Kuwait told the world that, without urgent outside help, it could not continue to pump oil at its customary rate.
The Kuwaiti oil minister invited Western oil companies back into his country to see if they could do better. The very next day the US government quietly slashed 11 million barrels a day (that's equivalent to the entire daily output of Saudi Arabia) from its forecast of oil production levels for 2025.
To most people who noticed them, such announcements will have seemed remote and academic. In fact, as I shall attempt to explain, they represent the tip of a very big iceberg indeed: one that holds the potential to sink the global economy.
We have allowed oil to become vital to virtually everything we do. Ninety per cent of all our transportation, whether by land, air or sea, is fuelled by oil. Ninety-five per cent of all goods in shops involve the use of oil. Ninety-five per cent of all our food products require oil use.
Just to farm a single cow and deliver it to market requires six barrels of oil, enough to drive a car from New York to Los Angeles. The world consumes more than 80 million barrels of oil a day, 29 billion barrels a year, at the time of writing. This figure is rising fast, as it has done for decades.
The almost universal expectation is that it will keep doing so for years to come. The US government assumes that global demand will grow to around 120 million barrels a day, 43 billion barrels a year, by 2025. Few question the feasibility of this requirement, or the oil industry's ability to meet it.
They should, because the oil industry won't come close to producing 120 million barrels a day; nor, for reasons that I will discuss later, is there any prospect of the shortfall being taken up by gas.
In other words, the most basic of the foundations of our assumptions of future economic wellbeing is rotten.
Our society is in a state of collective denial that has no precedent in history, in terms of its scale and implications.
Of the current global demand for oil, America consumes a quarter. Because domestic oil production has been falling steadily for 35 years, with demand rising equally steadily, America's relative share is set to grow, and with it her imports of oil.
Of America's current daily consumption of 20 million barrels, 5 million are imported from the Middle East, where almost two-thirds of the world's oil reserves lie in a region of especially intense and long-lived conflicts.
Every day, 15 million barrels pass in tankers through the narrow Straits of Hormuz, in the troubled waters between Saudi Arabia and Iran. The US government could wipe out the need for all their 5 million barrels, and staunch the flow of much blood in the process, by requiring its domestic automobile industry to increase the fuel efficiency of autos and light trucks by a mere 2.7 miles per gallon.
But instead it allows General Motors and the rest to build ever more oil-profligate vehicles. Some sports utility vehicles (SUVs) average just four miles per gallon. The SUV market share in the US was 2 per cent in 1975. By 2003 it was 24 per cent.
In consequence, average US vehicle fuel efficiency fell between 1987 and 2001, from 26.2 to 24.4 miles per gallon. This at a time when other countries were producing cars capable of up to 60 miles per gallon."
-Jeremy Leggett, The Independent, January 20, 2006
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That, dear reader, is a dose of reality.
But as my friend Doug Casey always says, "crisis = opportunity."
And we're staring at one of the greatest crisis and investment opportunities of a generation.
In the medium-term, energy investments are merely taking a breather from the 1st leg of their run. The next bull market leg will be bigger. Make sure you're invested.
Sincerely,
Michael Schaefer
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