The countdown has begun.

When you're sitting next to a television with the channel permanently set to CNBC, you'd be amazed how long your eyes fixate on the price for crude oil. Nothing gets by you-the dips, the peaks and the hours that pass where oil is seemingly glued at a single price.

Yet the number your longing to see-the psychological benchmark of $100 per barrel-has yet to appear.

I wasn't shocked to see another drop in U.S. oil stocks this week from the Energy Information Agency report. I wasn't even surprised when oil flew past $98 a barrel. But the first question I get from every phone call I make is, "When will it hit $100 a barrel?"

My answer is always the same, too, when it comes to peaking oil production.

"Well, let's put it this way," I typically start, "if we see another significant decline similar to the recent 3.9 million barrel drop, you'll get your $100 oil by the end of next week."

Does anyone else remember earlier this year when the Saudis said oil prices were "optimal" around $50?

Nine months later, oil prices have nearly doubled.

A few years ago, I couldn't find one out of a hundred people who've even heard of the term 'Peak Oil.' Mentioning peak oil in a crowded room would invite puzzled looks from anyone within earshot.

Fortunately, that has changed somewhat...

To think it only took about fifty years (since Hubbert's speech 1956 speech).

The End of Cheap Oil

I do need to apologize for any confusion over last Tuesday's article concerning what peak oil was about, so I'll try to be as clear as possible right now...

Peak oil is the point in time when the maximum oil production is reached, followed by an irreversible decline.

In other words, there will still be a large amount of oil in the ground. As I briefly mentioned last Tuesday, there's plenty of oil left in the ground.

In 2005, the Hirsch report was created for the U.S. Department of Energy. The first sentence was dead on, "The peaking of world oil production presents the U.S. and the world with an unprecedented risk management problem."

Those of you who were enjoyed reading Hubbert's original 1956 paper should take the time to read the Hirsch report. You can click here to find it.

The report came to several conclusions on peaking oil production...

• The peaking of world oil production will happen, and will most likely be abrupt.

• Peak oil will create a severe liquids problem in the transportation sector.

• Trillions of dollars will be spent to deal with the problem.

• Intervention by governments will be required.

• Mitigation efforts to avoid severe impacts of peak oil could take up to two decades.

• Both supply and demand will require attention.

The Hirsch report emphasizes the seriousness of the situation. The longer it takes to implement a mitigation strategy, the harsher the consequences.

Naturally, the first question to come to mind is: How soon until global oil production peaks?

Depending on who you ask, the answer is going to vary. In fact, I've had people tell me that production is secure until 2030...

I only hope they're right.

On the other hand, I've also talked to several analysts that feel global oil production has either already peaked, or won't be able to grow more than 88 million barrels a day. If that is true, we're going to be in a lot of trouble, considering our oil demand is projected to reach that level in 2008!

So where does that leave us?

Personally, I think it gives us the investment opportunity of a lifetime.

There's going to be a massive amount of money flowing into the oil infrastructure over the next few decades. And once you come to grips with the reality of peak oil, the next logical step is to figure out what's next.

After all, our future demand for energy is going to be met somehow.

Next week I'm going to show you exactly what to look for, and more importantly, where you can go when investing in this energy crisis.

Until next time,

Keith Kohl