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The Tyranny of Oil

December 15, 2008

 

book_tyrannyofoil
Now, as a potential investor, there are two ways to view the book I have just read by Antonia Juhasz called “The Tyranny of Oil: The World’s Most Powerful Industry – and What We Must Do to Stop It. The book, just published by Harper Collins [ISBN 978-0-06-143450-1], and available at your local library it seems, is a damning indictment of an industry that is under-regulated, secretive, controlled by too few people and which wields excessive power and influence over U.S. elected politicians, all to the detriment of the citizens of the United States and anywhere else it finds itself operating, their economies, and the world’s environment. Don’t let their adverts fool you into thinking they are ‘part of the solution’ – they are no friend to alternative energies, as Antonia’s book reveals.

The ‘here-we-are-again’ history outlined in the book is particularly interesting given the excesses of “Big Oil’s” previous incarnation – John D. Rockerfeller’s Standard Oil Company, which had to be broken up in the early nineteen hundreds because of the dark excesses of its monopolistic hold over American democracy. Now, the spawn of that breakup have, with the anti-reglatory ideology of the Reagan and Bush years, once more merged back together to the point where their unbridled greed and power is once again threatening the very democracy of the United States. Juhasz argues that ‘Big Oil’ must be broken up again – and this time permanently. It is a great and sobering read for anyone interested in the oil industry, and there is further information and interviews with the author about the book to be found on the tyrannyofoil.com website.

What does it mean in terms of investment in the industry? Well, if you are a futures trader then I would advise a career change, probably sometime in the next 6 – 12 months. I think for the smaller investor it will actually open up many more opportunities as the industry is split up into different operating entities, such as production, refining, marketing and so on, and when more independents are encouraged to re-enter the industry again. As for those of you thinking more in terms of some Exxon shares, perhaps you might like to read Antonia’s book before making that decision – there are always two ways of looking at these things.

Don’t be Caught by an Oil Investment Scam

December 1, 2008

Oil & Gas Investment Scams
It is a sad fact of life that where ever an investment opportunity is presented there is also likely to be a variety of people trying to scam you out of your investment money – and oil and gas investment is certainly not immune. We at Energy Exchange have heard many an unhappy tale regarding such scam artists and, therefore, we are happy to see that the U.S. Securities and Exchange Commission has a page on their website dedicated to informing the unwary investor just what to look out for when it comes to scam oil and gas investments.

The site can be seen at http://www.sec.gov/investor/pubs/oilgasscams.htm
They list the various items that should raise a red flag to any potential investor including sales pitches, unsolicited materials, offers of high rates of return. They also offer advice about how to research a company before you invest with them. Knowledge is power, as they say. Don’t let the scam artists win, or put you off from investing in legitimate oil and gas opportunity!

Will Credit Crisis Affect Candidates Energy Policies?

October 6, 2008

Obama, McCain Energy Plan affected by credit crisis?
The problem for both campaigns is the increasing doubt over whether their plans are now going to be drastically delayed, or if they are affordable at all given the current economic crisis. The lone voice on energy still seems to be the nightly adverts from T. Boone Pickens. I think it is safe to say that all sides agree that one of the key priorities by all concerned is to reduce the country’s dependence on foreign oil, and that clean, renewable energy is an important element of any plan. The only problem is that such a plan requires huge amounts of capital investment, on the sort of scale that only the government can manage. However, if the government is strapped for money and there is no movement in the credit markets where is the money supposed to come from. Obama certainly sees clean energy as the engine of a new ‘green-tech’ economy and, what with increasing concerns over the damaging effects of global warming, and with 5 million projected green-tech jobs being created by it, this is one area of Obama’s future plan that he couldn’t conceivably forestall. Part of the recent bailout bill did include tax breaks for companies building solar panel installations which could give that particular industry a initial boost.

The keystone of McCain’s energy plan is the building of 45 nuclear power stations by 2030. The price tag for this would be $6 Billion per power station, much of which, again, would have to come from the government rather than Wall Street. No doubt the “Drill Baby Drill” part of his plan would be greatly stimulated by the $4 Billion tax cuts he wants to give to the big oil companies but most experts not only can see that this wouldn’t do anything to help the domestic problem of price increases, even after the ten years it would take to get that oil flowing, but that also it is not going to address the “addiction to oil” problem – only extend it.

“The challenge for the new president is to “reduce reliance on foreign oil, address high fuel bills and stimulate the economy on a tighter budget”, says Mark Harrington of Newsday.com

“There’s no better time than now to start building more low-emission transportation, wind and solar,” said Ashok Gupta of the Natural Resources Defense Council, a national environmental organization. “Worrying only about the higher cost was “narrow thinking” in light of potential benefits . . . we have to look to technology, energy efficiency and renewables to be the answer,” he said. “That’s the only way – to invest our way out of the [economic] problems.”

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July 15, 2008

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