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Record High Gas Prices Fueling our Profits

Written by Keith Kohl
Posted May 14, 2007

Dear Wealth Daily reader,

If you haven't noticed yet, gasoline prices have climbed again. The recent jump to $3.07 per gallon surpasses the record highs we experienced after 2005's devastating hurricane season.

Should we assume some similar catastrophic event took place lately? I mean, something had to happen to escalate prices.

Think again.

We're experiencing record breaking prices even though crude oil is trading much less than it was during the 2005 hurricane disruptions.

Also don't forget that we haven't even hit the peak driving season!

So what can we expect?

For starters, we should get comfortable with the idea of paying four dollars for a gallon of gas.

Why did gas get so expensive?

The reason is due to lower refinery production. The Energy Information Agency reported that gasoline supplies declined by roughly 15% since February.

But we shouldn't be too upset, though. We've all come to accept higher gasoline prices a part of life.

In fact, high oil prices are one of the best things that can happen right now.

Our readers know the implications of peak oil very well. The EIA estimates that a barrel of oil will average $66 this year. Some industry experts are predicting that oil in 2007 could breach $80 a barrel.

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I can tell you they both could be wrong--by a long shot.

When you include the hurricanes and bombs that could make fall this summer, oil prices could shoot well over $100 a barrel in a heartbeat.

Yet even if we somehow dodge these things this year, the simple fact is that our growing consumption rates will ensure us that we'll never see oil below fifty or possibly even sixty dollars a barrel ever again.

The $1.50 Gallon of Gas

When I said that soaring oil prices are good, I wasn't kidding.

The reason is that if oil was $30 a barrel and gas was under a buck, we wouldn't think of developing newer energy sources. But now that oil is around $63 a barrel, the need to curb our oil addiction is becoming painfully clear.

But if these record gasoline prices are being blamed on the inability of refineries to keep up production, why hasn't the U.S. built more refineries?

We haven't built a new refinery in about 30 years! I can only wonder if our government feels the end of oil is much closer than we expect.

When it comes to meeting our future energy needs, dear readers, we can expect to see a huge demand for natural gas.

So far in 2007 the U.S. has consumed ten percent more natural gas than during the same period last year.

And natural gas is also growing in areas we would least expect.

Honda currently markets a Civic GX that runs on natural gas. This car is so clean that its exhaust is cleaner than the polluted air it takes in. Drivers can fill up at over 1,500 fuel stations across California or even at home.

Some drivers have reported that filling their car up at home is costing them under $1.50 per gallon!

As I kept reading about this natural gas powered car, I just couldn't understand why it hasn't taken off yet. I expect consumers will be more open to the idea when they're paying over $5 dollars a gallon for gasoline within the next few years.

If you're interested in finding out more about Honda's GX, just click here.

But here's the thing, friends...

Our dependence on foreign oil is a huge concern. And we're going to look somewhere for relief.. Barring some miracle breakthroughs in renewable energy, we can expect help to come from other fossil fuels like coal and natural gas.

But I want you to find out for yourself just how easy it is to make a profit from energy. Many of my readers are already taking advantage of the newest energy plays at the Pure Energy Report.

Until next time,

keith Signature

Keith Kohl
Buffett's Envy: 50% Annual Returns, Guaranteed