Most Popular
1. Banking Crisis is Stocks Bull Market Buying Opportunity - Nadeem_Walayat
2.The Crypto Signal for the Precious Metals Market - P_Radomski_CFA
3. One Possible Outcome to a New World Order - Raymond_Matison
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
5. Apple AAPL Stock Trend and Earnings Analysis - Nadeem_Walayat
6.AI, Stocks, and Gold Stocks – Connected After All - P_Radomski_CFA
7.Stock Market CHEAT SHEET - - Nadeem_Walayat
8.US Debt Ceiling Crisis Smoke and Mirrors Circus - Nadeem_Walayat
9.Silver Price May Explode - Avi_Gilburt
10.More US Banks Could Collapse -- A Lot More- EWI
Last 7 days
Stock Market Volatility (VIX) - 25th Mar 24
Stock Market Investor Sentiment - 25th Mar 24
The Federal Reserve Didn't Do Anything But It Had Plenty to Say - 25th Mar 24
Stock Market Breadth - 24th Mar 24
Stock Market Margin Debt Indicator - 24th Mar 24
It’s Easy to Scream Stocks Bubble! - 24th Mar 24
Stocks: What to Make of All This Insider Selling- 24th Mar 24
Money Supply Continues To Fall, Economy Worsens – Investors Don’t Care - 24th Mar 24
Get an Edge in the Crypto Market with Order Flow - 24th Mar 24
US Presidential Election Cycle and Recessions - 18th Mar 24
US Recession Already Happened in 2022! - 18th Mar 24
AI can now remember everything you say - 18th Mar 24
Bitcoin Crypto Mania 2024 - MicroStrategy MSTR Blow off Top! - 14th Mar 24
Bitcoin Gravy Train Trend Forecast 2024 - 11th Mar 24
Gold and the Long-Term Inflation Cycle - 11th Mar 24
Fed’s Next Intertest Rate Move might not align with popular consensus - 11th Mar 24
Two Reasons The Fed Manipulates Interest Rates - 11th Mar 24
US Dollar Trend 2024 - 9th Mar 2024
The Bond Trade and Interest Rates - 9th Mar 2024
Investors Don’t Believe the Gold Rally, Still Prefer General Stocks - 9th Mar 2024
Paper Gold Vs. Real Gold: It's Important to Know the Difference - 9th Mar 2024
Stocks: What This "Record Extreme" Indicator May Be Signaling - 9th Mar 2024
My 3 Favorite Trade Setups - Elliott Wave Course - 9th Mar 2024
Bitcoin Crypto Bubble Mania! - 4th Mar 2024
US Interest Rates - When WIll the Fed Pivot - 1st Mar 2024
S&P Stock Market Real Earnings Yield - 29th Feb 2024
US Unemployment is a Fake Statistic - 29th Feb 2024
U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - 29th Feb 2024
What a Breakdown in Silver Mining Stocks! What an Opportunity! - 29th Feb 2024
Why AI will Soon become SA - Synthetic Intelligence - The Machine Learning Megatrend - 29th Feb 2024
Keep Calm and Carry on Buying Quantum AI Tech Stocks - 19th Feb 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Electric Vehicles to Charge Up as Crude Oil Rises

Companies / US Auto's Feb 12, 2013 - 10:44 AM GMT

By: InvestmentContrarian

Companies

George Leong writes: With the outlook for the U.S. and global economies looking more encouraging, we have seen a corresponding upward push by oil prices on the chart.

An issue for us is that oil prices continue to be largely dictated by the folks in the Middle East, namely the 11-member oil cartel Organization of the Petroleum Exporting Companies (OPEC). At this time, OPEC feels oil prices of $100.00 a barrel are reasonable, and $80.00 is viewed as the low point that is acceptable for oil prices. This might be fine with OPEC, as it adds to their rich coffers; but with the average price of gasoline at $3.54 a gallon, consumers aren’t happy with these high oil prices. (Source: U.S. Energy Information Administration web site, last accessed February 8, 2013.)


But unless we see a massive flow of new oil from the controversial tar sands in Alberta, Canada, and a move back to offshore drilling in the post-BP era, oil prices will continue to be dictated by OPEC. I think it’s wrong to be held hostage by a group of oil-rich countries.

The U.S. has agreed to allow oil from the tar sands to be delivered to refineries in Texas, but the process to retrieve the oil from the tar sands is not considered environmentally friendly. Europe, at this time, is looking at placing the tar oil on the “no-go” list.

The government must continue to look at ways to reduce the country’s insatiable appetite for oil and reduce the impact of high oil prices on the U.S. economy.

Oil magnate T. Boone Pickens continues to push his view to cut the country’s reliance on foreign oil. He is investing heavily in alternative energies, such as natural gas and wind-powered energy generation.

President Obama knows this and has increased government spending on creating less dependence on fossil fuels. The government has spent about $2.7 billion in stimulus to try to get the electric vehicle (EV) market going. And with the high price of gasoline, I expect the demand for pure electric or hybrid vehicles to continue to grow.

There is estimated to be 30.6 million EVs sold in 2011 worldwide; this is expected to rise to 51.3 million EVs sold by 2021, according to IDTechEx.

In the U.S., the Obama administration has a goal of one million EVs on the road by 2015.

A play on the rising demand of electric vehicles and other electric-dependent applications is Monrovia, California-based AeroVironment, Inc. (NASDAQ/AVAV). Founded in 1971, AeroVironment operates in two key segments: efficient energy systems (EES) and electric-powered unmanned aircraft systems (UAS).

The real intriguing thing about AeroVironment is its EES segment that includes the EV-charging solutions area. This comprises home charging, public charging, fast charging, data collection, grid-integrated communications, training, and support services. Clients include consumers, automakers, utilities, government agencies, and businesses. The charging systems are currently used in 25 states. The end result would be clean energy and reduced impact from high oil prices.

Clearly, there is plenty of long-term potential here, and it appears that AeroVironment is at the forefront of this development.

Source:http://www.investmentcontrarians.com/stock-market/electric-vehicles-to-charge-up-as-oil-rises/1413/

By George Leong, BA, B. Comm.
www.investmentcontrarians.com

Investment Contrarians is our daily financial e-letter dedicated to helping investors make money by going against the “herd mentality.”

George Leong, B. Comm. is a Senior Editor at Lombardi Financial, and has been involved in analyzing the stock markets for two decades where he employs both fundamental and technical analysis. His overall market timing and trading knowledge is extensive in the areas of small-cap research and option trading. George is the editor of several of Lombardi’s popular financial newsletters, including The China Letter, Special Situations, and Obscene Profits, among others. He has written technical and fundamental columns for numerous stock market news web sites, and he is the author of Quick Wealth Options Strategy and Mastering 7 Proven Options Strategies. Prior to starting with Lombardi Financial, George was employed as a financial analyst with Globe Information Services. See George Leong Article Archives

Copyright © 2013 Investment Contrarians- All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Investment Contrarians Archive

© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in