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Posts tagged “investing”

By Robert Rapier on Jun 24, 2008 with no responses

PEIX Drops Below $2

Wow! I just checked a few stocks that I tend to watch, and Pacific Ethanol (PEIX) has now fallen to $1.85 a share. It is now down more than 95% off its high, and down more than 90% from the first time I warned that the company was overvalued. Once boasting a market cap of almost $2 billion, that has now fallen to $82 million. Now, where are all of those posters who kept telling me what a deal this was after it fell to $10? Like our friend James, who cited PEIX investor Bill Gates’ “ability to see into the future” as a reason to invest in PEIX, and told me I was “very, very stupid” if I thought… Continue»

By Robert Rapier on with no responses

Updated Corn Ethanol Economics

Executive Summary: The current cost to produce a gallon of ethanol is approximately $3/gal. The current price of ethanol is $2.86/gal, which explains why ethanol producers are shutting down. If corn and natural gas prices remain high, I think ethanol has to rise to something like $3.40-$3.60/gal to make it worthwhile to ethanol producers. So, if I was a commmodities investor, I would probably go long ethanol right now. The only risk factors I can see – given that there is a mandated (and rising) demand for ethanol – is if corn or natural gas prices collapse. ————————— This is an update to a post I originally made back in February 2008: Corn Ethanol Economics. While this is approximate, I… Continue»

By Robert Rapier on Jun 17, 2008 with no responses

LS9 Stock

There was a major story a few days ago about LS9 in the Times Online: Scientists find bugs that eat waste and excrete petrol I have previously written several articles that mentioned LS9, including: LS9′s Oil-Crapping Bugs Apparently as a result of the Times article, there have been a number of articles in the past couple of days on LS9. This naturally attracted the attention of investors, and I have literally had hundreds of hits to my LS9 story by people Googling LS9 stock. In fact, right now if you Google that (without quotation marks), my story comes up at the top of the first page. So, in an effort to provide investors what they are looking for (the other… Continue»

By Robert Rapier on Jun 9, 2008 with no responses

Book Review: Profit from the Peak

One of the threats from peak oil is the potential for financial ruin as oil prices run up. If you were invested in airline or automotive stocks through the recent run up in oil prices, you have probably seen those investments lose a lot of value. If, on the other hand, you were invested in oil futures, oil companies, or oil field service companies – you have probably seen those investments gain ground even as the overall stock market slumped. The idea of profiting from the peak – an event that is likely to cause misery for those who are least prepared – may seem an odd combination. It almost feels like “Profit from Homelessness.” But the reality is that… Continue»

By Robert Rapier on May 2, 2008 with no responses

Oil to $250 a Barrel?

In case you missed it, there were several stories this week – and of particular note coming from OPEC – that suggested that much higher oil prices may be on the way: Oil Price May Go Up to $250, Warn Experts Crude prices continue to baffle analysts and pundits. With the $100-era a well established fact in our daily life, there is now a growing chatter within the energy fraternity that $200 a barrel may not be a far fetched idea altogether. Is another global oil shock now gathering pace? With limited additional supplies, alternative fuel still some decades away and demand far from collapsing, Deutsche Bank is pointing to a “huge risk” that oil prices would continue to rise… Continue»

By Robert Rapier on Apr 17, 2008 with no responses

Where Our Oil Imports Come From

Following the theme of the previous post on where we get our gasoline imports, below is the list of our Top 10 sources of oil imports for 2007. For 2007, our Top 10 importers of crude oil into the U.S. in million barrels were: 1. Canada 680.533 million barrels2. Saudi Arabia 530.2453. Mexico 514.484. Venezuela 419.8415. Nigeria 394.8566. Angola 181.2157. Iraq 177.0098. Algeria 161.7559. Ecuador 72.13810. Kuwait 64.306 Source: U.S. Crude Imports by Country of Origin If you compare to the list for gasoline imports, Canada is the only country common to both lists (although “OPEC Countries” in total came in at #10). Any surprises on that list? I am surprised to see Ecuador in the Top 10. I would… Continue»

By Robert Rapier on Apr 1, 2008 with no responses

Pacific Ethanol in Trouble

Don’t say I didn’t tell you so. I warned about PEIX’s poor fundamentals a year and a half ago, and the share price has fallen steadily since then. Pacific Ethanol suffers a bigger-than-expected loss Pacific Ethanol Inc., a California biofuels darling that boasts political connections and an investment from Bill Gates, is short on cash and suffering from higher corn and plant construction costs, which threaten to derail the once-promising biofuels maker. The Sacramento company on Monday posted record-high sales but a larger-than-expected $14.7-million loss in the fourth quarter, reflecting a financial squeeze that has clouded prospects for ethanol producers nationwide. Pacific Ethanol reported the loss just days after it shored up its depleted coffers with a $40-million cash infusion… Continue»

By Robert Rapier on Mar 9, 2008 with no responses

Slow Squeeze

I have been thinking a lot lately about the impact of $100+ oil prices on the world economy. Like many others, I am trying to work out the probable implications – for the overall economy, for the U.S. economy, for the energy sector, for my personal finances, and for the average person. I believe we have entered an era of permanently higher oil prices, because 1). Supply and demand are in a very tight balance; and 2). OPEC has been very disciplined about keeping a tight reign on supplies. I just don’t see demanding falling enough, nor supply growing enough, to make a major change in the status quo. In the course of doing a little research, I ran across… Continue»

By Robert Rapier on Feb 25, 2008 with no responses

Investing in Energy Storage

I attended a presentation last year where a number of alternative energy technologies were discussed, and I was asked whether any major topic had been missed. I responded that I felt like the single most important topic had been missed: The enabling technology of energy storage. An efficient and cost effective energy storage solution is critical for smoothing out the intermittency of solar, wind, and tidal energy. This is the one advantage that biomass does have over these sources: Biomass may be inefficient at gathering solar energy, but it does store nicely. How important is energy storage? I think it is absolutely crucial, but largely overlooked in alternative energy discussions. It simply isn’t as sexy as solar, but without a… Continue»

By Robert Rapier on Jan 24, 2008 with no responses

Recession-Proof Jobs

I sometimes get questions from people wondering what kinds of jobs will be safest in the future. I always recommend that people look for something that interests them in either the energy or health care field. I am not as familiar with the manpower issues in the health care field, but we have serious shortages in the energy sector. This is also consistent with my investment strategy. I invest primarily in energy, health care, international stocks, and environmental companies. Today, Yahoo published an article that suggests that these sectors – plus the education and security sectors – are exactly where jobs will be safest from a recession: Recession-Proof Jobs in 2008 John Challenger, CEO of outplacement firm Challenger, Gray and… Continue»