It is important that the U.S. and other developed countries build alternative (to oil and coal) energy sources. However, even that won't change the dynamics that drive oil prices.
The growth in China and India (with more than 2.5 billion citizens combined) will keep demand high. Although there is controversy over the supply numbers, it is safe to say that there are plenty of oil resources for the next 25 plus years.
These oil reserves may be harder to tap (oil sands for example), but that will just help keep prices high.
Add to that political turmoil, speculators and other factors and the bright future for oil is hard to deny.
For example, many stock investors know that the price of energy figures into almost everything in our economy.
Whether it is used as a raw material or for powering electrical plants or the cost of doing business in a mobile market, energy prices can dramatically affect a company's profits.
When the cost of energy is low, investors often overlook companies strongly tied to the price of oil, for example.
However, few industries can pass rising costs to consumers as quickly as oil companies. It seems like we read about a price hike in oil and before we return home for the evening, the price of gas at the pump has risen.
With these rising prices, energy companies often do very well when the price of oil is on the upswing.
To be certain, the price of oil will bounce up and down, sometimes dramatically.
Oil companies, especially the large, integrated ones, have little to worry about when it comes to exploiting their almost total control of the marketing and distribution of oil and energy products.
When looking at the future, it is hard to ignore the potential oil giants have for making a profit at almost any reasonable price per barrel of oil.
As much as we may talk of fuel efficiency, alternative energy sources and other measures, the U.S. and the developed and developing world run on oil. Not a bad industry to include in your portfolio.
