Collision Course: 1. The price of oil has been the most important leading indicator of both the US economy and the stock market. When the price of oil double in a twelve month period of time – stock prices decline in a range between -27 percent and 4 percent. On the other hand, if oil prices declined over a twelve-month period, stocks returned from -1 percent to +30 percent. Using the formula from 1973 – 2000 and buying and selling on the year-over-year using 80 percent and 20 percent, a 20k investment would have increased 70 times. 2. Over the past 30 years America is losing control over its energy supply. Oil production by non-OPEC nations appears to reach its maximum level and may in fact have begun to decline. 3. Global demand for oil has been increasing by 1.5 and 2 million barrels a day. In 2006, 86 million bpd of oil was consumed by the world. Saudi Arabia for the last 20 years has been unable to increase production capacity. Capacity is being distribute to fields all over of the world. Declining oil fields (2007-2010 daily oil production in mil bar): Ghawar (5.6 to 5.0), Cantarell (1.7 to 1.2), Sonatrach (1.1 to 0.9), Daqing Fields (.8 to .7), Ahwaz Asmaru (.6 to .5) Increasing fields: Burgan (1.2 to 1.3), Safaniyah (1.2 to 1.3), Azeri (.6 to 1.2), Bu Hasa (.5 to .7), Ku-Maloob-Zaap (.5 to .7), Northern Fields (.5 to .8), Upper Zakum (.5 to .6) India is created the world's largest refiner. Oil production increases will be in the Caspian sea, Kuwait, and Iraq and refined in India. Peak oil does not seem to be a problem in the next three years.[Learn More ...]

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