Crude Oil Higher From Here?

If you listen to "The Street" it would appear oil has no where to go but up. But a quick look ay our Smart Scan Chart Analysis gives us good reason to be cautious about going long at these levels. Let's look at the most popular crude oil ETF, USO.

Our Smart Scan Chart Analysis shows the current uptrend in USO is very weak and at a crossroads and has possibly ended. Look for choppy trading action in the near term and as always make sure to trade this trend with very tight stops.

Based on a pre-defined weighted trend formula for chart analysis, USO scored +60 on a scale from -100 (strong downtrend) to +100 (strong uptrend)....

-10......Last Hour Close Below 5 hour Moving Avg
+15......New 3 Day High on Monday
+20......Last Price Above 20 Day Moving Average
+25......New 3 Week High, Week Ending October 9th
-30......New 3 Month Low in May
+60......Total Score

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Crude Oil Technical Outlook For Tuesday Morning Oct. 5th

Crude oil was higher overnight as it extends the rally off August's low. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near term.

If November extends the rally off last week's low, August's high crossing at 83.91 is the next upside target. Closes below the 20 day moving average crossing at 77.31 would confirm that a short term top has been posted.

First resistance is Monday's high crossing at 82.38
Second resistance is August's high crossing at 83.91

Crude oil pivot point for Tuesday morning is 81.54

First support is the 10 day moving average crossing at 78.20
Second support is the 20 day moving average crossing at 77.31


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As Crude Oil Climbs, Expect $100 per Barrel by January, 2011

From analyst Dian L. Chu.....

Last week the shorts were all lined up for another bearish inventory report for Petroleum products from the EIA, but lo and behold, miracles do actually occur. We had an extremely bullish report (Fig. 1) which caught a lot of traders poorly positioned, and many fund managers underexposed to the commodity, which relative to Gold, Silver, and Copper, smelled like a bargain in the face of further quantitative easing expected by the Federal Reserve in the 4th quarter.

The technicals indicate that upward resistance will not be found until the $84 per barrel level, so despite Crude Oil moving from roughly $75.60 before the report on Wednesday morning to close Friday`s electronic session at $81.73, a $6.13 move in 3 days, there is still more room to go for this upward move in the commodity. (Fig. 2)

The real surprise in the report was the large drop--3.5 million barrels-- in gasoline inventories, and the RBOB contract needed to re-price itself given this change which was largely due to lower imports on the supply side, as demand for gasoline is still relatively anemic year on year.

Distillate demand has recovered strongly over the last 6 weeks from the lows of the summer (Fig. 3), and is quite robust year on year, and a great sign that the double dip scenario is officially off the table. Remember, that distillate demand represents usage from the industrial and manufacturing sectors of the economy, which will be the first indications of potential economic strength or weakness.....Read the entire article.

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Crude Oil Trades Near Eight Week High After U.S. Stocks Fall, Goods Orders Gain

Crude oil traded near an eight week high in New York after equities slipped and orders for U.S. capital goods increased the most since March. Futures retreated yesterday after stocks declined for the third time in four days and the dollar advanced against the euro. The Commerce Department reported that orders for non military capital goods excluding planes climbed 5.1 percent. An Energy Department report tomorrow will probably show crude supplies rose last week, according to a Bloomberg News survey.

“It’s hard to justify a further move higher with stocks down and the dollar stronger,” said Gene McGillian, an analyst and broker at Tradition Energy in Stamford, Connecticut. “We’ll see if we can consolidate here and keep an eye on this week’s economic reports.” The November contract traded at $81.39 a barrel, down 8 cents, in electronic trading on the New York Mercantile Exchange at 9:45 a.m. Sydney time. Yesterday it lost 11 cents to $81.47. Oil closed at $81.58 on Oct. 1, the highest level since Aug. 5. Prices are up 2.5 percent this year.

The Standard & Poor’s 500 Index dropped 0.8 percent to 1,137.03 at the 4 p.m. close in New York, and the Dow Jones Industrial Average shed 0.7 percent to 10,751.27. The dollar strengthened from a six month low against the euro as concern that Europe’s major banks are undercapitalized made the region’s assets less attractive. The U.S. currency traded at $1.3676 after falling 0.8 percent yesterday.....Read the entire article.

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Hey Sharon....Where is Crude Oil and Gold Headed on Tuesday?

CNBC's Sharon Epperson discusses the day's activity in the commodities markets, and looks ahead to where oil and gold are likely headed tomorrow.



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Stock Market and Commodities Commentary For Monday Evening Oct. 4th

The U.S. stock indexes closed weaker today on more profit taking. No near term chart damage has occurred and the bulls still have the near term technical advantage. The indexes last week hit fresh multi month highs. Traders are gearing up for Friday's U.S. employment report. Look for more subdued trading in the stock indexes until then, but then look for an active trading day on Friday, in the wake of the jobs data.

Crude oil closed up $0.03 at $81.61 a barrel today. Prices closed near mid range today and hit a fresh two month high. Bulls still have the near term technical advantage in crude and have good upside near term technical momentum. Prices are in a six week old uptrend on the daily bar chart.

Natural gas closed down 6.8 cents at $3.729 today. Prices closed near mid range today and hit a fresh contract low. The bears have the solid overall near term technical advantage and have gained more downside power recently. The next upside price objective for the bulls is closing prices above solid technical resistance at $4.00. The next downside price objective for the bears is closing prices below solid technical support at $3.50.

Gold futures closed down $1.30 at $1,316.50 today. Prices today closed near mid range and did some consolidation after scoring another fresh record high on Friday. Mild profit taking pressure was featured amid a firmer U.S. dollar index today. Gold bulls still have the solid overall near term technical advantage. There are no early technical clues that a market top is close at hand. Prices are in a nine week old uptrend on the daily bar chart.

The U.S. dollar index closed up 34 points at 78.65 today. Prices closed nearer the session high today and saw short covering in a bear market. Bears still have the solid overall near term technical advantage. There are still no early clues to suggest a market bottom is close at hand.

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Crude Oil and Gas Reserves Rise Despite Decline in Investment

Total hydrocarbon reserves worldwide increased for the first time since 2005 despite a decline in worldwide upstream investment and development spending. Worldwide upstream investment declined by 23 percent to $378 billion in 2009 among 224 oil and gas companies surveyed, but total worldwide total hydrocarbon reserves grew three percent, according to IHS Herold's report 2010 Global Upstream Performance Review. Production also increased one percent, driven by a 2.2 percent increase in natural gas output. Development spending declined by nearly 20 percent, the first decline in a decade.

"We were very surprised at the strength of reserve additions given the weak economic conditions and tightness in credit markets during 2009," said Nicholas D. Cacchione, director of IHS Herold and author of the report. Oil reserves reversed a two year decline, rising three percent to 164 billion barrels, mostly due to extensions and discoveries in the Canadian oil sands that added 8.6 billion barrels in positive reserve additions. A record 7.9 billion barrels also was added in the South and Central American regions also added a record 7.9 billion barrels.

Natural gas reserves climbed 3.7 percent despite a record 11.4 Tcf in negative reserve revisions, as development of unconventional plays in North America and liquefied natural gas resources in Asia accelerated. The decline in capital spending resulted from a 40 percent reduction by exploration and production companies, while the integrated oil companies cut investment by just nine percent. Exploration spending was most resilient, dropping just 12 percent to $62.7 billion. Unproved acquisition costs were down 71 percent, and a two percent dip in proved acquisition outlays would have fallen 50 percent were it not for the $20 billion Suncor/Petro-Canada merger.

Lower capital spending and higher reserves resulted in a near 50 percent decrease in reserve replacement costs, to $11.41/barrel of oil equivalent (BOE), and lowered finding and development costs to $12.23/BOE. Strong natural gas reserve additions led reserve replacement rates to the highest levels in five years.....Read the entire article.


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Phil Flynn: Easy Oil

Who has the second largest amount of proven conventional oil reserves or easy to get to oil? Well if you asked me yesterday the answer officially was Iran but today that all may change. Iraq has announced that they will increase the amount of their proven oil reserves from mere 115 million barrels of oil to a whopping 143.1 billion barrels of oil putting them in second place in the world of cheap, easy to get to oil. Dow Jones reports that the figure, the first update since 2001, would mean Iraq has the world's second largest reserves according to statistics on the OPEC website.

Iraq would take second place from Iran, which has 137.01 billion barrels of proven reserves, but would still be far behind Saudi Arabia, which has 264.59 billion barrels of proven oil reserves, according to OPEC figures. These aren't random figures, rather they were the results of deep surveys carried out by the ministry's oil reservoir company and international companies which signed contracts with Iraq," al-Shahristani said. "Most of these figures were the result of surveys conducted by these international companies, especially at oil fields such as West Qurna and Zubair." Dow Jones say that Iraq has signed 12 deals with international oil companies to ramp up.....Read the entire article.


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Price Headley: Last Week's Action May be the Start of a Small Correction

The Crude Oil Trader would like to welcome our newest contributor Price Headley at BigTrends.com. Here is Price's weekly market report for Monday October 4th....

The four week win streak came to an end last week last week, though barely. Still, all pullbacks start with a small step, and last week's action may well be the beginning of at least a small correction. The dip came despite the much-improved economic news. Nearly all the data not only rolled in better than expected, but showed sustained improvements…. income, spending, sentiment (except for the Conference Board's consumer confidence), GDP, and most of the other data nuggets were pointed higher.

So why the pullback? It's all a matter of timeframes. In the long run, the good economic news should indeed translate into more bullishness for stocks. In the near-term (which is our primary focus from one week to the next), fear, greed, momentum, and excess movement drive the market for option trading. That's what we'll dissect below, after a closer look at the economy.

Economic Outlook
It was a plenty busy week last week on the economic front, with a rough start, but a strong finish. Though still improving, the rate of increase in home values, according the Case-Shiller index – slowed to a pace of 3.18% last month, versus the prior increase of 4.21%. Also on Tuesday, the Conference Board said consumer confidence slumped from 53.2 to 48.5 last month.

From Thursday on, however, it was nothing but good news.

Q2's GDP was revised upward, to 1.7%. Initial claims sank to near-multi-year-lows of 453K, while ongoing claims fell to 4457K… also approaching new multi year lows. The lines in the sand for each are 440K and 4430K, respectively. On Friday, the news got even more compelling. Incomes as well as spending were both up, and better than anticipated (by 0.5% and 0.4%, respectively). And, the prior week's problematic University of Michigan Sentiment number was revised upward, from 66.6 to 68.2.

How does the continued uptrend in incomes as well as spending last while both confidence measures sink? As we've said before, the confidence opinion polls are 'supposed to be' assessments about the next six months. In reality, they are assessments of the prior month. Moreover, in many ways they can be interpreted as contrarian indicators....meaning be bullish when they're most bearish, and vice versa.

Indeed, Friday's latter data confirmed that consumers aren't nearly as mired as they claim to be. Construction spending was up a tad, against the backdrop of an expected 1.4% contraction. And, though the final numbers aren't in yet, auto sales have remained strong this year – and in September – despite worries that things are going to get worse before they get better. It's all below.

Let's take a look at the charts for this coming week.....Price Headley's view for this week.

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A Trader's First Book on Commodities: An Introduction to The World's Fastest Growing Market

The Simple, Practical, 100% Useful How-To Guide for New Commodities Traders from Carley Garner.....

You can make large profits by trading commodities--but you’ll need significant practical knowledge of the associated risks and market characteristics before you start. That’s where this book comes in. You won’t find boring theory or bewilderingly complex trading strategies here. You will find specific guidance on accessing commodity markets cost-effectively, avoiding common beginners’ mistakes, and improving the odds of successful, profitable trades.

Drawing on her extensive experience teaching traders, Garner shows how to calculate profit, loss, and risk in commodities, and choose the best brokerage firm, service level, data sources, and market access for your needs.

Garner demystifies the industry’s colorful language, helps you clearly understand what you’re buying and selling, and walks you through the entire trading process. She concludes with a refreshingly new look at topics such as trading plans, handling margin calls, and even maintaining emotional stability as a trader.

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Bloomberg Analysis: Crude Oil to Hit Resistance Level at $86.70 This Week

Crude oil may fail to breach the $86.70 a barrel level this week based on statistical analysis used by traders to gauge prices, the Schork Group Inc. said. Crude’s resistance at that level corresponds to the upper limit of the confidence interval, a statistical range with a specified probability that a given parameter lies within the boundaries. Oil is most likely to trade this week between $76.76 a barrel and $86.70, according to the Schork Group.

Oil prices have jumped 4.7 percent since Sept. 29 to $81.53 today as signs of positive economic growth in the U.S. and China improve the outlook for fuel demand. Crude’s gains may sputter to a halt as prices climb to highs reached earlier this year in April and May. “Prices will hit serious resistance in any attempt to cross the $86.70 barrier,” said Schork Group President Stephen Schork. Oil climbed to this year’s highest close at $86.84 on April 6 and reached $86.19 on May 3, followed by sell offs below $70, he said.

The November contract was at $81.52 a barrel, down 6 cents, in electronic trading on the New York Mercantile Exchange at 11:54 a.m. Singapore time after reaching $81.87. It surged $1.61 to settle at $81.58 on Oct. 1, the highest close since Aug. 5, capping the biggest weekly gain since February. “The bulls should have enough momentum to hold prices close to either side of the $80 barrier, thus we expect prices to trade safely inside our confidence interval,” the Schork Group said.

Reporter Christian Schmollinger can be contacted at christian.s@bloomberg.net.

Courtesy Bloomberg News


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Crude Oil Technical Outlook For Monday Morning Oct. 4th

Crude oil was lower due to profit taking overnight as it consolidates some of last week's rally. Stochastics and the RSI are overbought but remain bullish signaling that sideways to higher prices are possible near term.

If November extends the rally off last week's low, the 87% retracement level of August's decline crossing at 82.41 is the next upside target. Closes below the 20 day moving average crossing at 76.99 would confirm that a short term top has been posted.

First resistance is the overnight high crossing at 81.87
Second resistance is the 87% retracement level of August's decline crossing at 82.41

Crude oil pivot point for Monday morning is 81.01

First support is the 20 day moving average crossing at 76.99
Second support is the reaction low crossing at 73.58



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3 Surprising ETF Ideas for a Possible Oil Rush

 From Gary Gordon at Seeking Alpha.Com

When is the last time that crude oil closed as high as $81.64 per barrel? You’d have to look back to 2008. At that time, crude was on its way down. This time, commodities like oil are trending higher! There are plenty of exchange traded investments for rising crude oil prices. Perhaps the most popular is United States Oil (USO), an ETF that endeavors to capture the the spot price of West Texas Intermediate Light Sweet Crude.

It should be noted, however, that USO has struggled immensely at tracking its intended index due to contango and backwardation. And the iPath Crude Oil ETN (OIL) hasn’t fared a whole heck of a lot better. Other folks hope to benefit from the corporations that explore for, produce and sell the commodity. Yet share prices of big energy companies have been hit from everything from oil drilling moratoriums to taxation and regulatory uncertainty.

ETFs like SPDR Select Energy (XLE) and Oil Services HOLDRs (OIH) have been under-performers regardless of reasonable share price valuation. So what’s an oil investor to do? Can you march to the beat of the oil drum....and actually achieve over sized returns? Yes you can. However, you might want to look in a slightly different direction.....Read the entire article.


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Crude Oil Trades Near Eight Week High as U.S. Consumer Spending Increases

Crude oil traded near an eight week high after economic data from the U.S. and China bolstered optimism that demand is growing in the world’s two largest energy consuming countries. Futures advanced 2 percent on Oct. 1 after U.S. consumer spending increased more than forecast in August as incomes climbed, a Commerce Department report showed. Prices also rose as China’s purchasing managers’ index gained in September at the fastest pace in four months.

“The broad sentiment is that a double dip in the U.S. is looking more and more unlikely,” said Ben Westmore, a minerals and energy economist at National Australia Bank Ltd. in Melbourne. “Combine that with the strong growth in China, and you’ve got the world’s two biggest oil consumers both looking like they’re in a recovery period.”

The November contract was at $81.63 a barrel, up 5 cents, in electronic trading on the New York Mercantile Exchange at 11:07 a.m. Singapore time after reaching $81.87. It surged $1.61 to settle at $81.58 on Oct. 1, the highest close since Aug. 5, capping the biggest weekly gain since February. Consumer purchases in the U.S. climbed for a second month, rising 0.4 percent and exceeding the 0.3 percent gain projected by the median forecast of economists surveyed by Bloomberg News. Incomes were up 0.5 percent, the biggest advance this year.....Read the entire article.


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Gold Stocks, SP500 & the U.S. Dollar – What’s Next?

From Chris Vermeulen, The Gold and Oil Guy......

Investors around the globe are concerned with the economic outlook, not only with the United States but with virtually every country. This has caused not only investors but banks and countries to start buying gold & silver in order to be protected incase of a currency melt down in the coming years.

While the majority is concerned about the eroding economy, we have seen the opposite in the financial market. Gold and equities have risen… That being said the volume in the market remains light simply because the average investor is no longer putting money into the market for long term growth. Instead individuals are now focusing on saving and paying down debt.

That being said we all know light volume market conditions allow Wall Street powerhouses to bid the market up. Not to mention with quantitative easing taking place I’m sure that has also helped the market of late. While we don’t know for sure that QE is taking place as we speak, the sharp drop in the dollar and strong move up in gold are pricing this into the market.

Let’s take a look at some charts....

HUI – Gold Stock Index
This long term monthly chart of the HUI index provides valuable trading signals for both gold stocks and gold bullion. As you can see below this index is trading at a key resistance level after forming a bullish 3 year Cup & Handle pattern. The next 1-2 months for the precious metals sector will be interesting as it tries to break above key resistance. I would really like to see the HUI:GLD ratio break to the upside to confirm if the breakout occurs.

SPY – Daily Long Term Trend
The broad market looks to be forming a short term topping wedge. If this is to occurI expect it to take several weeks to play out. Looking at the chart if we use Fibonacci retracements along with trend line support we can get a feel for where this pullback should correct to.

That being said the broad market breadth and internals seem to be holding up indicating higher prices over the long run. While the short term price action is overbought and I expect a pullback to form, my analysis is pointing to higher prices as we go into year end.

UUP – US Dollar Daily Price Action
Although the majority of investors have a bearish outlook on the economy, we have seen a large price appreciation in equities and precious metals. This is largely due to the fact that the US dollar is quickly getting devalued. Simply put, as the dollar drops, it helps boost commodities and stock prices.

While a rising stock market is great to see, at some point the dollar will become so cheap that it will start to have a very negative affect on the US economy, commodities and stocks. Being from Canada it has always been more expensive to take holidays in the United States, and I remember paying $1.50-$1.70 for every $1 green back. But now the dollar is almost at par making holidays very affordable. The big question/concern is when will they ease off on the printing? At the rate which they are printing the greenback will be at par with peso… well not that extreme but you get the point Eh!

Weekend Market Conclusion:
As we all know the market has a way of making sure the majority of traders miss major turning points. The saying is, “If the market doesn’t shake you out, it will wear you out” and it seems we are getting the later…

The never ending grind higher in precious metals has not had any big shakeouts, rather its wearing out any short positions before rolling over to take a breather. As for the stock market, we are getting much of the same thing as the market grinds higher day after wearing out the shorts before rolling over.

That being said, there is more at work here than just regular market movements. With the light volume in the market we know there is price manipulation and QE (quantitative Easing) which is helping to boost prices and exaggerate market movements.

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Let the volatility and volume return!
Chris Vermeulen



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Why Your World Is About to Get a Whole Lot Smaller: Oil and the End of Globalization

An internationally renowned energy expert has written a book essential for every American, a galvanizing account of how the rising price and diminishing availability of oil are going to radically change our lives. Why Your World Is About to Get a Whole Lot Smaller is a powerful and provocative book that explores what the new global economy will look like and what it will mean for all of us.

In a compelling and accessible style, Jeff Rubin reveals that despite the recent recessionary dip, oil prices will skyrocket again once the economy recovers. The fact is, worldwide oil reserves are disappearing for good. Consequently, the amount of food and other goods we get from abroad will be curtailed; long-distance driving will become a luxury and international travel rare. Globalization as we know it will reverse. The near future will be a time that, in its physical limits, may resemble the distant past.

But Why Your World Is About to Get a Whole Lot Smaller is a hopeful work about how we can benefit–personally, politically, and economically....from this new reality. American industries such as steel and agriculture, for instance, will be revitalized. As well, Rubin prescribes priorities for President Obama and other leaders, from imposing carbon tariffs that will increase competition and productivity, to investing in mass transit instead of car-clogged highways, to forging “green” alliances between labor and management that will be good for both business and the air we breathe.

Most passionately, Rubin recommends ways every citizen can secure this better life for himself, actions that will end our enslavement to chain-store taste and strengthen our communities and timeless human values.

About the Author
Jeff Rubin is the chief economist and chief strategist at CIBC World Markets. He was one of the first economists to accurately predict soaring oil prices back in 2000 and is now one of the world’s most sought after energy experts. He lives in Toronto.


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Natural Gas Weekly Technical Outlook For Sunday Oct. 3rd

Natural gas continued to stay in sideway consolidations in familiar range last week and outlook remains unchanged. While another rise cannot be ruled out, we'd expect upside to be limited by 4.288 support turned resistance and bring resumption of the whole fall from 5.196. Below 3.732 minor support will suggest that such consolidation is completed and will flip intraday bias back to the downside for 3.61 support. Break will target 3.0 psychological level next. However, decisive break of 4.288 will indicate that a short term bottom is at least formed and will bring stronger rise to 5.007 resistance instead.

In the bigger picture, whole decline from 6.108 is still in progress and further fall should be seen to 100% projection of 6.108 to 3.81 from 5.194 at 2.896 next. More importantly, recent development revived the case that medium term rebound from 2.409 is completed at 6.108 already. Also, fall from 6.108 might indeed be resuming the long term down trend for a new low below 2.409. We'll pay attention to the structure of the current decline for more hints. On the upside, break of 4.288 resistance will be the first signal of reversal. Further break of 5.007/194 resistance zone will in turn argue that fall from 6.108 has finished.

In the longer term picture, while the bounce from 2.409 was strong, it's been limited below 55 months EMA (now at 5.814) and reversed. The failure to sustain above 55 weeks EMA (now at 4.498) also argue that 2.409 might not be the bottom yet. We'll stay bearish as long as this year's high of 6.108 holds and favor a new low below 2.409 going forward.

Nymex Natural Gas Continuous Contract 4 Hour, Daily, Weekly and Charts



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Hey Sharon....Where is Crude Oil and Gold Headed Next Week?

CNBC's Sharon Epperson discusses the day's activity in the commodities markets, and looks ahead to where oil and gold are likely headed tomorrow.



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Weakness in U.S. Dollar Continues to Support Commodities

Weakness in the dollar continued to support commodities. Although several US data released last week beat expectations, speculations that the Fed will expand the bond buying program did not abate. The dollar index plunged for a 3rd week to 78.08, down -1.65% on the week.

The energy complex was the best performer of the week with crude oil and fuel prices surging 6-7%. Precious metals strengthened further with gold making new nominal highs and silver 30 year highs. Base metals continued to perform well as strong Chinese PMI signaled demand for the complex should sustain.

Central bank meetings will be the focus next week. Driven by robust economic data and hawkish speeches from policymakers, the RBA is expected to raise the policy rate by 25 bps on Tuesday. The ECB and the BOE will be meeting on Thursday. We believe both central banks will leave monetary policies unchanged.

Let's look at the charts for nominal returns in energy, precious metals and base metals.

The "Super Cycle" in Gold and How It Will Affect Your Pocketbook in 2010

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John Mauldin: The U.S. Consumer is Dead, and Gas Is Going To $5 A Gallon

This week I am at a conference in Houston. I must confess that I don't attend many of the sessions at most conferences where I speak. But today, the guys at Streettalk Advisors have such a great lineup that I am there for every session. But it's Friday and I need to write. The solution? This week you get a "best of" letter. The best ideas I've heard and the best charts I've seen at this conference. Then we close with two short but very thoughtful essays from Charles Gave and Arthur Kroeber of GaveKal on "The Morality of Chinese Growth." Lots of charts and something to make you think. Should be a good letter.

Oil at $125 a Barrel, Gasoline at $5

John Hofmeister is the former president of Shell Oil and now CEO of the public-policy group Citizens for Affordable Energy. He paints a very stark (even bleak, as he gets further into the speech) picture of the future of energy production in the US unless we change our current policies. First, because of the aftereffects of the moratorium. It is his belief that the drilling moratorium will effectively still be in place until at least the middle of 2012. There won't even be new rules until the end of 2011, and then the lawsuits start.

Gulf oil production will be down by up to 1 million barrels a day. Imported oil is now 67% of oil usage but will go to 75% by 2012. He thinks crude oil will be up to $125 and gasoline between $4-$5 at the pump. And it will only get worse. He describes the problem with the electricity from coal production. The average coal plant is 38 years old, with a planned-for life of 50 years. Our energy production capability is rapidly aging, and we are not updating it fast enough.

He argues that the fight between the right and the left has given us 37 years without a realistic energy policy, as policy gets driven by two year political cycles but good energy planning takes decades. There are 13 government agencies that regulate the energy industry, with conflicting mandates that change very two years. There are 22 congressional committees that have some level of involvement and oversight of the energy industry.

Read the entire post on The Business Insider


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