When it comes to cheap energy, we’re spoiled.
There’s really no other way to put it.
What’s more, our access to cheap energy is one of the primary reasons for our success.
It’s a love affair that began more than a century ago during the early stages of the U. S. oil industry.
Prior to that, we were paying exorbitant sums for oil…
In the early to mid-1800s, we weren’t drilling into U.S. soil to satisfy our demand.
A flourishing whaling industry provided this country with fuel to burn.
At the time, a gallon of sperm oil — popularly used for lamp oils, candles and such — cost consumers about $2.00. By today’s standards, that comes out to around $200 a gallon.
In other words, it wasn’t cheap. (And let’s call to mind the environmental toll this method took.)
So when kerosene entered the scene as a much cheaper alternative, you can imagine the collective sigh of relief from consumers — and the ocean.
By the 1860s, more than thirty kerosene plants were up and running in the United States. Kerosene lamps were so much more inexpensive, they replaced the use of whale oil practically overnight.
Of course, kerosene had been overtaken by electricity as the main source of lighting by the end of the 19th century.
But the petroleum industry managed to survive:
Today the United States finds itself once again at a crossroads with cheap energy.
But it’s coming from a different cheap (for now), plentiful source: natural gas.
Forget the Government Red Tape
Cheap energy has been so long part of American history, it’s ingrained in our economy, our culture, our lifestyle.
And we can see how much it weighs on the minds of politicians.
Energy Secretary Steven Chu was questioned extensively during the budget hearing last week as the topic of exporting our abundant source of natural gas came up several times — each time with a note of concern.
He may only be a Nobel Prize-winning physicist, but Secretary Chu did a good job staying as vague as possible when asked about sending our nat gas abroad: “We’re not going to do anything until we make a determination what the impact would be.”
Pardon our skepticism after watching the Keystone XL project approval process get shuffled around like a deck of cards…
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Believe me, dear reader, opposition is growing.
Increased LNG export means less available domestic supply, leading to higher natural gas prices here in the States.
Congress is worried that higher prices will be painful for our manufacturing industry — as well as U.S. households. And perhaps their concern isn’t entirely unfounded…
Regardless, there’s sure to be a tangled web of red tape surrounding the issue.
And the more obstacles that arise, the more difficult it will be for future LNG export projects to gain approval.
Of course, we’ve seen the kind of moves that U.S. LNG stocks can make just from the prospect of shipping to Asia…
Cheniere Energy is a perfect example. The future U.S. LNG exporter has tripled for investors since October:
The majority of people — those who are only tuned in to media headlines — don’t realize that opposition is mounting toward U.S. LNG exports.
And that’s exactly why there are better opportunities developing.
You see, there’s a small group of natural gas players quietly taking control of nearly every aspect of a different LNG trade relationship that’s growing between North America and Asia…
It won’t matter how much kicking and screaming we hear from the U.S. Congress, or even the president’s uncanny ability to cave to environmental pressures…
Because at the end of the day, this isn’t their money. It’s yours.
Until next time,
Keith Kohl
Check us out on YouTube!A true insider in the technology and energy markets, Keith’s research has helped everyday investors capitalize from the rapid adoption of new technology trends and energy transitions. Keith connects with hundreds of thousands of readers as the Managing Editor of Energy & Capital, as well as the investment director of Angel Publishing’s Energy Investor and Technology and Opportunity.
For nearly two decades, Keith has been providing in-depth coverage of the hottest investment trends before they go mainstream — from the shale oil and gas boom in the United States to the red-hot EV revolution currently underway. Keith and his readers have banked hundreds of winning trades on the 5G rollout and on key advancements in robotics and AI technology.
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