Climate Change Is Real – But So Are the Benefits of Fossil Fuel Technology

Climate Change Is Real – But So Are the Benefits of Fossil Fuel Technology

  • Today, the price of oil is more than 40% lower than it was 10 years ago.
  • The rout in the oil patch in recent years is setting us up for one of the great buying opportunities of our lifetimes.
  • However, you might miss it if you’re busy demonizing the fossil fuel industry.

alexgreen.jpg

Alexander Green, Chief Investment Strategist, The Oxford Club

Today, the price of oil is more than 40% lower than it was 10 years ago.

This should make consumers happy. After all, it has reduced prices at the pump further still. It has lowered inflation. And it has goosed the economy.

It should make investors happy too. Most companies are buyers, not producers, of oil. Lowering their costs reduces prices and boosts net income. And since share prices follow earnings, that’s a plus for the stock market.

But you’ll notice there is one vocal group that is entirely unhappy with the drop in oil: environmentalists. They argue that lower prices will stoke demand and increase greenhouse gases.

I’m not insensitive to their concerns. I’m an environmentalist myself. Not one who sits in an air-conditioned office wringing his hands about the future of the planet. I actually spend a great deal of time hiking in the wilderness, awestruck by the beauty and majesty of the natural world that sustains us all.

Climate change is real. And carbon emissions are a big part of it. Yet the voices of many prominent environmentalists are remarkably shrill:

  • Author Bill McKibben writes that “We need to view the fossil-fuel industry in a new light. It has become a rogue industry, reckless like no other force on Earth. It is Public Enemy Number One to the survival of our planetary civilization.”
  • James Hansen, a prominent climate scientist, says oil company CEOs should be “tried for high crimes against humanity and nature.”
  • And in a review of Naomi Klein’s book This Changes Everything: Capitalism vs. the Climate in The New York Times, Rob Nixon openly laments that we are unable to bankrupt the major oil companies.

This is not environmentalism. This is mindless anti-corporatism.

How will you heat your home, drive your car or fly from point A to point B without fossil fuels?

Wind power? Hydro? Solar? Hamsters on a wheel?

Fossil fuels aren’t just our primary source of energy. They are used to create everything from plastic chairs to personal computers to lifesaving medical devices.

They have led to continual, groundbreaking improvements in communications, transportation and technology. Their use has correlated with a dramatic increase in income, standards of living and human life expectancy. No other source could possibly meet the energy needs of the more than 7 billion inhabitants of this planet.

So, yes, let’s do what we reasonably can to reduce greenhouse emissions. But that doesn’t require returning to a pre-industrial age.

At some point – and it may be sooner than we think – human ingenuity, technology and entrepreneurship will deliver alternative energy sources that are safer and greener. We know this because the free market provides ample incentives and rewards.

Fossil fuels are the lifeblood of the world economy. They are indispensable. Moreover, the rout in the oil patch in recent years is setting us up, in my view, for one of the great buying opportunities of our lifetimes.

However, you might miss it if you’re busy demonizing the fossil fuel industry.

That’s not just hypocritical and naïve. It’s an assault on human welfare.

Good investing,

Alex

Alexander Green is the Chief Investment Strategist of The Oxford Club and Investment U, and Editor of The Oxford CommuniquéThe Insider Alert,  The Momentum Alert and The True Value Alert. Alex is also the author of four national best-sellers
This article was originally published in the Investment U free e-letter. To read more from them, click here.

 
Sprott U.S. Media, Inc. is a wholly owned subsidiary of Sprott Inc., which is a public company listed on the Toronto Stock Exchange and operates through its wholly-owned direct and indirect subsidiaries: Sprott Asset Management LP, an adviser registered with the Ontario Securities Commission; Sprott Private Wealth LP, an investment dealer and member of the Investment Industry Regulatory Organization of Canada; Sprott Global Resource Investments Ltd., a US full service broker-dealer and member FINRA/SIPC; Sprott Asset Management USA Inc., an SEC Registered Investment Advisor; and Resource Capital Investment Corp., also an SEC Registered Investment Advisor. We refer to the above entities collectively as “Sprott”.

The information contained herein does not constitute an offer or solicitation by anyone in any jurisdiction in which such an offer or solicitation is not authorized or to any person to whom it is unlawful to make such an offer or solicitation.

Forward-Looking Statement

This report contains forward-looking statements which reflect the current expectations of management regarding future growth, results of operations, performance and business prospects and opportunities. Wherever possible, words such as “may”, “would”, “could”, “will”, “anticipate”, “believe”, “plan”, “expect”, “intend”, “estimate”, and similar expressions have been used to identify these forward-looking statements. These statements reflect management’s current beliefs with respect to future events and are based on information currently available to management. Forward-looking statements involve significant known and unknown risks, uncertainties and assumptions. Many factors could cause actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements. Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking statements prove incorrect, actual results, performance or achievements could vary materially from those expressed or implied by the forward-looking statements contained in this document. These factors should be considered carefully and undue reliance should not be placed on these forward-looking statements. Although the forward-looking statements contained in this document are based upon what management currently believes to be reasonable assumptions, there is no assurance that actual results, performance or achievements will be consistent with these forward-looking statements. These forward-looking statements are made as of the date of this presentation and Sprott does not assume any obligation to update or revise.

Views expressed regarding a particular company, security, industry or market sector should not be considered an indication of trading intent of any fund or account managed by Sprott. Any reference to a particular company is for illustrative purposes only and should not to be considered as investment advice or a recommendation to buy or sell nor should it be considered as an indication of how the portfolio of any fund or account managed by Sprott will be invested.

 

Sprott US Media
1910 Palomar Point Way, Suite 200
Carlsbad, CA 92008 USA

Be the first to comment on "Climate Change Is Real – But So Are the Benefits of Fossil Fuel Technology"

Leave a comment

Your email address will not be published.


*


This site uses Akismet to reduce spam. Learn how your comment data is processed.