I’ve decided to stop posting to the Energy Investment Strategies web site and to take the site down eventually.  There are two reasons.   One is that I need to concentrate my efforts on fighting my cancer.  The other is that I think to a large extent my original aims for this site have been accomplished.  The site was started to educate investors about “peak oil”, its implications for potential future energy shortages, related increases in the importance and value of energy-related equities, and ways investors can best participate .  …

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Just as we see Russia combining military and energy deals in Venezuela and Cuba, China is doing the same thing with both Venezuela and Brazil, as the following report details.  China has increased its importation of oil from Brazil, is cementing agreements to further that trend, and is doing military and oil deals with Venezuela as well.    With both Russia and China combining military and energy policy for national security purposes,  Americans must ask what its government is doing to secure its energy future in the face of …

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The Wall St. Journal carried the following report that points out the short term burst in oil supplies expected to come from Asia. OCTOBER 7, 2008 Asia’s Oil Production Expected to Increase, Ease Stress on Global Supplies By PATRICK BARTA After years of putting a strain on world energy supplies, Asia is expected to significantly increase its own oil production next year, a development that could add to downward pressure on prices. China, India and other big energy users in Asia aren’t about to become major oil exporters …

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Hugo Chavez would like nothing more than to sell all his oil to some customer other than the U.S.  That way he both gets his revenue and hurts his energy.  He seems to have found his customer - China.  As the report below describes, Venezuela, which has ramped up its China oil sales to 250 kb/d so far, is planning on 500 kb/d in 2009 and 1 mb/d by 2012.  Since the Venezuela currently is the fourth largest supplier to the U.S. at 1.1 mb/d and since exports …

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I noted in my recent comment on asset allocation toward cash, it would make sense to the Chinese governement to discourage gas consumption.  Well, it seems they are doing just that.  The following was reported today in The Gartman Report and elsewhere:   “We note this in light of a decision announced today inBeijing wherein China will raise the consumption tax onhigh-emission passenger vehicles and will cut theconsumption tax on low-emission passenger vehicles aspart of efforts to conserve energy. This is simple; this iselegant and this is …

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A report from Reuters (below) headlining lower Chinese oil imports in July contains a much more interesting comment:  “We believe first-half crude stocks have risen much faster than a year ago, together with inventories of gasoline and diesel,” said Yan Kefeng, a senior Beijing-based analyst with Cambridge Energy Research Associates who closely tracks China’s rarely reported oil inventory data. “We are likely to see fuel imports slowing in the coming months.” China July crude imports in biggest fall since Jan 05 Reuters , Monday August …

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John Mauldin, a brilliant economic observer in my opinion, publishes other analysts’ views once a week.  Below is an extremely interesting essay by Vitaliy N. Katsenelson, CFA,  Director of Research at Investment Management Associates in Denver, published my Mauldin, that explains why the enormous growth rate China has experienced in the past ten years could cause its next period to be one of slow or no growth. If you would like to have a free subscription to John Mauldin’s emailed writings, click on www.frontlinethoughts.com and follow the instructions.  …

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The following report from Asia Times Online points to another example of strategic trade by China.  “Looking to fill the vacuum created when the Russians returned home from the five former Soviet Central Asian republics of Kazakhstan, Kyrgyzstan, Uzbekistan, Tajikistan and Turkmenistan, and the roubles dried up, China is now making moves to become the new Central Asian superpower.”

China’s interest in these poor Muslim countries is primarily their fossil fuel resources.  Once again we see China wrapping up a supply of oil before it can hit the …

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The report posted below from the Washington Post is focused on continuing high Chinese demand for big cars like Hummers despite fuel subsidy reductions.   It is worth remembering that developing countries are now experiencing the same reckless conspicuous consumption habits among their many newly wealthy citizens that the U.S. saw in the ’80’s and ’90’s.  SUV sales in China were up 43% in May, for example.  The piece also cites continuing subsidies for oil in other developing countries.  By Ariana Eunjung Cha Washington Post Foreign Service Monday, …

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As I’ve noted before, the difference between China’s national policy on buying oil and that of the OECD in general and the U.S. in particular is striking.  The Chinese have been trying to wrap up as many direct bi-lateral purchase agreements as they can while the U.S. relies on the “free market.” The U.S. may become highly disadvantaged by being a passive observer as China takes oil off the market via long term bilateral deals.  China’s actions will result ultimately in less oil being available to the free market.  …

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The number of reports of electricity shortages in China, India, and other developing economies recently, some of which I have posted, seem to be increasing.  Part of the problem in China may be due to environmental sensitivity surrounding the Olympics.  But it may also reflect a real shortage of coal globally and also the fact that electricity is becoming  uneconomical to produce given price controls on electricity combined with rising coal prices.   The last sentence of the report below from The Times  on an “electricity crisis …

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  China’s Power Crisis Deepens as Coal Supply Dwindles (Update1) By Wang Ying July 29 (Bloomberg) — China, the world’s second-biggest energy consumer, is facing a deepening summer power crisis that may persist into the winter months, the nation’s dominant electricity distributor said. State Grid Corp. of China, which more than 1 billion people rely on for power, said electricity shortages have worsened because of inadequate coal supplies. Forty-six percent of the power stations connected to the distributor’s grid have coal stockpiles below the “caution line,” or …

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This story may not impact the price of oil in the near term but some day it may bite.  It’s a useful construct for understanding what is happening in the geo-politics of oil, which is vital since above-ground conditions increasingly determine how much oil reaches OECD markets. Here is the short version:    1. A great deal of future potential oil flows lie offshore Africa.    2. Shipments of oil from Nigeria are attracting pirates.  Bandits who are internal to Nigeria are also stealing much …

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I recently wrote that China is experiencing severe shortages of electricity caused by coal shortages.   A number of other developing economies, particularly in Asia, are seeing the same problem.  As I wrote earlier, such shortages may well increase Asian demand for diesel fuel to run emergency generators. Here is a report from Reuters detailing exactly where the Chinese shortages are occurring and which provinces are likely to turn to diesel generators to ameliorate their problems. worst hit by power shortages Fri Jul 11, 2008 10:33am BST …

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The Chinese economy grew at a rate in excess of 10% per year during the first six months of 2008, according to this story in the Wall Street Journal.  While that rate is 20% lower than the 12% rate in 2007, it is still extremely healthy.  It suggests an increase in oil demand in the 5% - 7% range.  Of course, China is also building its strategic petroleum reserves too, so the total increase in oil demand in China might be closer to …

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