Best of the Week
Most Popular
1. TESLA! Cathy Wood ARK Funds Bubble BURSTS! - 12th May 21
2.Stock Market Entering Early Summer Correction Trend Forecast - 10th May 21
3.GOLD GDX, HUI Stocks - Will Paradise Turn into a Dystopia? - 11th May 21
4.Crypto Bubble Bursts! Nicehash Suspends Coinbase Withdrawals, Bitcoin, Ethereum Bear Market Begins - 16th May 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.Cathy Wood Ark Invest Funds Bubble BURSTS! ARKK, ARKG, Tesla Entering Severe Bear Market - 13th May 21
7.Stock Market - Should You Be In Cash Right Now? - 17th May 21
8.Gold to Benefit from Mounting US Debt Pile - 14th May 21
9.Coronavius Covid-19 in Italy in August 2019! - 13th May 21
10.How to Invest in HIGH RISK Tech Stocks for 2021 and Beyond - Part 2 of 2 - 18th May 21
Last 7 days
How to Trade Binance Vanilla Options for the First Time on Bitcoin Crypto's - 2nd Aug 21
From vaccine inequality to economic apartheid - 2nd Aug 21
Stock Market Intermediate Top Reached - 2nd Aug 21
Gold at a Crossroads of Hawkish Fed and High Inflation - 2nd Aug 21
Bitcoin, Crypto Market Black Swans from Google to Obsolescence - 1st Aug 21
Gold Stocks Autumn Rally - 1st Aug 21
Earn Upto 6% Interest Rate on USD Cash Deposits with Binance Crypto Exchange USDC amd BUSD - 1st Aug 21
Vuze XR VR 3D Camera Takes Near 2 Minutes to Turn On, Buggy Firmware - 1st Aug 21
Sun EXPLODES! Goes SuperNova! Will Any planets Survive? Jupiter? Pluto? - 1st Aug 21
USDT is 9-11 for Central Banks the Bitcoin Black Swan - Tether Un-Stable Coin Ponzi Schemes! - 30th Jul 21
Behavior of Inflation and US Treasury Bond Yields Seems… Contradictory - 30th Jul 21
Gold and Silver Precious Metals Technical Analysis - 30th Jul 21
The Inadvertent Debt/Inflation Trap – Is It Time for the Stock Market To Face The Music? - 30th Jul 21
Fed Stocks Nothingburger, Dollar Lower, Focus on GDP, PCE - 30th Jul 21
Reverse REPO Market Brewing Financial Crisis Black Swan Danger - 29th Jul 21
Next Time You See "4 Times as Many Stock Market Bulls as There Are Bears," Remember This - 29th Jul 21
USDX: More Sideways Trading Ahead? - 29th Jul 21
Waiting On Silver - 29th Jul 21
Showdown: Paper vs. Physical Markets - 29th Jul 21
New set of Priorities needed for Unstoppable Global Warming - 29th Jul 21
The US Dollar is the Driver of the Gold & Silver Sectors - 28th Jul 21
Fed: Murderer of Markets and the Middle Class - 28th Jul 21
Gold And Silver – Which Will Have An Explosive Price Rally And Which Will Have A Sustained One? - 28th Jul 21
I Guess The Stock Market Does Not Fear Covid - So Should You? - 28th Jul 21
Eight Do’s and Don’ts For Options Traders - 28th Jul 21
Chasing Value in Unloved by Markets Small Cap Biotech Stocks for the Long-run - 27th Jul 21
Inflation Pressures Persist Despite Biden Propaganda - 27th Jul 21
Gold Investors Wavering - 27th Jul 21
Bogdance - How Binance Scams Futures Traders With Fake Bitcoin Prices to Run Limits and Margin Calls - 27th Jul 21
SPX Going for the Major Stock Market Top? - 27th Jul 21
What Is HND and How It Will Help Your Career Growth? - 27th Jul 21
5 Mobile Apps Day Traders Should Know About - 27th Jul 21
Global Stock Market Investing: Here's the Message of Consumer "Overconfidence" - 25th Jul 21
Gold’s Behavior in Various Parallel Inflation Universes - 25th Jul 21
Indian Delta Variant INFECTED! How infectious, Deadly, Do Vaccines Work? Avoid the PCR Test? - 25th Jul 21
Bitcoin Stock to Flow Model to Infinity and Beyond Price Forecasts - 25th Jul 21
Bitcoin Black Swan - GOOGLE! - 24th Jul 21
Stock Market Stalling Signs? Taking a Look Under the Hood of US Equities - 24th Jul 21
Biden’s Dangerous Inflation Denials - 24th Jul 21
How does CFD trading work - 24th Jul 21
Junior Gold Miners: New Yearly Lows! Will We See a Further Drop? - 23rd Jul 21
Best Forex Strategy for Consistent Profits - 23rd Jul 21
Popular Forex Brokers That You Might Want to Check Out - 22nd Jul 21
Bitcoin Black Swan - Will Crypto Currencies Get Banned? - 22nd Jul 21
Bitcoin Price Enters Stage #4 Excess Phase Peak Breakdown – Where To Next? - 22nd Jul 21
Powell Gave Congress Dovish Signs. Will It Help Gold Price? - 22nd Jul 21
What’s Next For Gold Is Always About The US Dollar - 22nd Jul 21
URGENT! ALL Windows 10 Users Must Do this NOW! Windows Image Backup Before it is Too Late! - 22nd Jul 21
Bitcoin Price CRASH, How to SELL BTC at $40k! Real Analysis vs Shill Coin Pumper's and Clueless Newbs - 21st Jul 21
Emotional Stock Traders React To Recent Market Rotation – Are You Ready For What’s Next? - 21st Jul 21
Killing Driveway Weeds FAST with a Pressure Washer - 8 months Later - Did it work?- Block Paving Weeds - 21st Jul 21
Post-Covid Stimulus Payouts & The US Fed Push Global Investors Deeper Into US Value Bubble - 21st Jul 21
What is Social Trading - 21st Jul 21
Would Transparency Help Crypto? - 21st Jul 21
AI Predicts US Tech Stocks Price Valuations Three Years Ahead (ASVF) - 20th Jul 21
Gold Asks: Has Inflation Already Peaked? - 20th Jul 21
FREE PASS to Analysis and Trend forecasts of 50+ Global Markets by Elliott Wave International - 20th Jul 21
Nissan to Create 1000s of jobs with electric vehicle investment in UK - 20th Jul 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

What You Should Do to Cut Your Energy Bill

Personal_Finance / Gas - Petrol Jan 14, 2011 - 08:06 AM GMT

By: Sean_Brodrick


Best Financial Markets Analysis ArticleA Modern American uses about as much energy as a blue whale. That’s not an easy feat, considering that blue whales outweigh us — even us supersized Americans — 2,285 to 1. But this has consequences for the whole world because the whole world wants to live like big, fat Americans, and the world can’t support 7 billion blue whales.

To bridge the gap between “Homo Americanus” and blue whales, we need to translate energy into its simplest form — watts. A human being at rest runs on around 90 watts of power. Crank up the voltage a bit — to about 250 watts — and that’s how much a primitive hunter-gatherer uses, padding through the jungle.

Now let’s add more baggage of civilization — hair dryers, electric shavers, computers, air conditioners, cell phones and cars. Eventually, the average lifestyle in United States consumes 11,000 watts. Going back to nature, what kind of animal needs 11,000 watts to live? A blue whale.

This comparison was made by theoretical physicist Geoffrey West in a recent article in The New York Times. West pointed out that big animals like blue whales and elephants can live within nature because they move around slowly. But humans break the natural order because we move around fast and use so much energy.

Shifting Into Overdrive

Dr. West makes a great point, but I think he’ll have to update his numbers down the road. Why? Because the amount of energy we use as a species is shifting into overdrive.

The U.S. Energy Information Administration (EIA) has raised its forecast for global oil consumption — AGAIN — this time to 88.023 million barrels a day from 87.65 million barrels a day. Where is the EIA expecting growth? In the emerging markets of China, India and so on.

China’s oil demand growth is astounding. China’s overseas purchases of crude oil for 2010 rose 18% from a year earlier to a record 239.3 million tons, according to Beijing’s General Administrator of Customs data.

The Chinese are already trying to soft-pedal this number. The Research Unit of China National Petroleum just forecast that China’s imports of gasoline, diesel, kerosene and naphtha could drop 23% this year due to government efforts to cool the economy.

That sounds like a pipe dream to me. I think it’s more likely that since China is furiously adding new refining capacity, its imports of refined products may flatten out or go down.

But remember, China’s gross domestic product is expected to grow 9.2% this year, compared with 10% in 2010. That’s hardly the environment for a drop in oil usage.

Throw the Models Out the Window

So, the U.S. Energy Department and just about everyone else was already counting on demand growth in emerging markets, but the 18% growth in China’s overseas purchases of oil last year was way more than anyone is expecting. Throw all those old models out the window.

And one other thing that the Energy Information Administration, International Energy Agency and others are counting on is no growth in energy demand in the United States this year. You know what? I think they’re wrong on that, too.

I am bullish on the U.S. economy. In December, we saw decent consumer spending fueled by the recent increase in the real personal savings rate. Looking ahead, it looks like we’ll see stronger than normal economic growth in the first quarter of 2011.

Why? Well, the Leading Economic Indicators turned positive in the second half of 2010. December’s LEI is very likely to be positive, given an increase in real money supply, a drop in initial jobless claims, a rise in stock prices, a strongly positive yield curve, and manufacturing hours that at least stayed flat and didn’t go down.

Unless there are terrible numbers in housing, factory orders and durable goods, December will be positive and that should carry on into the first quarter. This should be very bullish for oil prices.

The second and third quarters are harder to read, but I would not be surprised to see the second quarter also show good economic growth.

More Comparisons

On a per-capita basis in 2009, India consumed 0.985 barrels per person — less than HALF the oil China consumed per capita (2.35 barrels per person). Meanwhile, China consumed a bit more than ONE-TENTH the oil the U.S. does per capita (22.22 barrels per person). The odds of these two developing nations increasing their oil use at a phenomenal rate are VERY HIGH.

Now, here’s another comparison to keep in mind:

  • The United States has 765 cars per 1,000 people — the most in the world.
  • China has 17 cars per 1,000 people.
  • India has just 12 cars per 1,000 people.

The people in those countries all want to drive like Americans. Car sales in China — now the world’s #1 new car market — and India are growing at a furious pace. And nearly all those cars will run on petroleum products.

Bottom line: I think we could see spikes in both crude oil and gasoline in the first half of 2011. To be sure, an oil price spike could drag on the economy or even send it skidding into recession again. There are a lot of variables in the mix. It can be a very scary time, but it can also be a profitable time … even for whale-sized profits.

What You Should Do

You can invest in select stocks and funds to make the most of a potential surge in oil prices. But you also might want to think about how you will adjust your lifestyle when gasoline goes to $4 a gallon … $4.50 a gallon … and higher.

Here are three things to do:

  1. Shop around for the lowest gas prices. You can find the lowest prices in your neighborhood and all around the U.S. and Canada at
  2. If you’re driving a gas guzzler, consider investing in a new car — before the price of gas-miserly cars goes through the roof. And consider buying a used car to save even more money. For example, here’s a list of the top penny-pinching cars for 2009: Some of them are already hitting the used-car lots.
  3. Start adjusting your lifestyle now. Start riding a bicycle when you can — I have mine fitted out with some great LL Bean panniers (removable baskets — you can find them at for quick trip to the grocery store. Talk to your boss about telecommuting a couple days a week. See what other steps you can take to protect yourself now from a potential oil price spike.

I think oil prices are going to surge. You can either be swamped by that surge, or ride it for all it’s worth.

All the best,


This investment news is brought to you by Uncommon Wisdom. Uncommon Wisdom is a free daily investment newsletter from Weiss Research analysts offering the latest investing news and financial insights for the stock market, precious metals, natural resources, Asian and South American markets. From time to time, the authors of Uncommon Wisdom also cover other topics they feel can contribute to making you healthy, wealthy and wise. To view archives or subscribe, visit

© 2005-2019 - 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