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Tuesday, January 29, 2013

The energy boom in America is opening the door for new investments

U.S. domestic oil production has reached an 8-yr high
Domestic oil production helps boost international exports
By Donald Turner

The United States and their explosive gas and oil energy growth provide some great investment opportunities to investors. Just a few years ago, the United States was importing an increasing amount of oil and natural gas each year. Yergin states the United States oil and gas production was in a steep decline since the 1970s providing very few investment opportunities. 

Newly developed technology has made it possible for tremendous growth in the United States gas and oil industries over the last five years. The United States will become the largest producer of oil and natural gas within the next two decades and the explosive growth in the US oil and gas production provides many opportunities to investors in most sectors of the United States economy, according to Jubak.

Current investing

Energy industry expansion benefits exploration technology manufacturers
U.S. oil production has benefitted from shale gas exploration

Carey from Forbes states that the most obvious places for investing would be with the companies that developed the new technology used for gas and oil production. These companies have seen impressive growth with some being bought out by big oil companies.

Current and near future investments

Companies in place to supply or support the oil and gas industry growth can offer prime investment opportunities through stocks or ETFs (Exchange Traded Funds). Companies that own gas and oil pipelines provide very economical means to ship the gas and oil over long distances in a timely manner. The pipelines help to ease bottle necking of the gas and oil going from the production fields to the market which can affect the price in the commodity market; another area investors can utilize. 

Transportation companies are a necessary component of the gas and oil production boom in the United States. The transportation industry hauls everything from gas and oil to market to hauling the parts for the drilling rigs to the water used for drilling. The transportation sector servicing the gas and oil production provides many opportunities to invest in by including truck and railroad companies. 

Construction companies contracted to build the infrastructure needed for the growing oil and gas production may provide great investment returns. Construction companies are building new pipeline systems to move the oil and gas supply to the markets and thus are responsible for building infrastructure necessary for the expansion.

Energy related investment opportunities have risen along with access to reserves
Large gas reserves are accessible via technology

Investments for the next few years

A great benefit being a leading oil and gas production country is lower energy costs as the lower energy costs provide the more investment opportunities and many companies will see an improved bottom line from energy cost savings. Chemical companies may receive the biggest benefit from reduced energy costs but any company that utilizes products from chemical companies will see a domino effect in their production prices giving investors a better return rate on Mutual Fund investments.

The United States gas and oil energy growth continues to rise; providing fantastic investment opportunities in many sectors of the US economy for investors. The smaller oil and gas companies that embraced the technology and took prudent action provide the most obvious investment choices. Supply and Support companies to the oil and gas industry offer many prime investment opportunities. Still, other investment opportunities can be realized in many other sectors of the US economy from reduced energy costs leading to an improved bottom line for most companies.

About the author: This article was written by Donald Turner, an avid writer of business and finance articles across the web. He writes this on behalf of US Emerald Energy, a company that has the facts about how to invest in oil.

All images: US-PDGov