Oil prices are especially noteworthy. You may remember the days in the seventies; you could fill up your tank for little over four dollars a week. Recently you may have paid over four dollars per gallon of gasoline. The oil price was under $10 per barrel in those days, recently it climbed over $140 per barrel.
Oil prices have been on the rise due to many factors. Some of the oil comes from politically unstable countries with radical rulers. The demand for oil has been increasing with industrialization of India and China. These two giants have over two billion consumers. Some investors and speculators have been bidding up the prices, just like the speculators did in dot com ventures. As we saw the dot coms popping up for dime a dozen, the value of the investments in dot coms went down in some cases by more than 80-90%.
While the speculators are driving oil and energy prices up, scientists, engineers and technicians are working on finding alternative forms of energy to fuel the cars and for heating and cooling the homes.
Many alternative forms of energy are being developed or are being expanded. Good example is nuclear power. In more than twenty years, not a single nuclear plant has been built in the United States. Now there are more than a dozen utilities working on building one or more nuclear power plant(s) each. Once these projects get off the drawing board, they will not need much oil or coal to provide services to their customers.
Many scientists and engineers are working on solar power, wind mills, hydro and geothermal projects. These projects will reduce the need for oil and coal significantly in coming years and decades. Many auto manufacturers have been busy developing cars that run on alternative fuels that will significantly reduce or eliminate the use of gasoline.
While some engineers are working on hydrogen or hydrogen fuel cells, some are working on hybrids using different technologies and some are trying to solve the energy problems using compressed natural gas.
When these alternative forms of energy become available in large enough quantities and at affordable prices, the investments in oil can be just like the investments in dot coms not too long ago!
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