Get ready for a REAL energy crisis... Investors NOTE - "buy coal stock now!"
While people sound silly squabbling about $4-5 dollar gas... coal runs over 70% of our nations energy and this will be painful.
As most of the world just embraced the market inflated price of OIL... now the market is eyeing COAL as the next price fixed "cash cow".
Haase - Sounds like classic "hold outs for deregulation and price fixing" my gut feeling.... is that the market is "looking for more funding and deregulation" and raising the commodity price will force tax payers to do it. As one of Americas largest exports the coal markets are trying to "stimulate" their sector by fixing production rates and raising rates.
HOUSTON - US coal production has room to grow, but the US Energy Information Administration has cut projections of US output rather than raised them, and now foresees a total of 1.166 billion short tons by 2010, barely up from a record 1.163 billion in 2006.
That is not enough to overcome what some coal officials see as a shortage of 25 million to 35 million tons this year in the 6-billion-ton world market and a shortfall of perhaps 70 million tons next year. "It's unlikely you'll see a lot of increased production in the very near term," said Todd Allen, spokesman for Foundation Coal Holdings Inc, one of the largest US coal producers.
"Closing the gap with US coal would require spending billions of dollars to expand mines, rails and ports, investment difficult to recover if ...."
"The weakness in this sector has often been the companies tend to overproduce when they get a sniff of good pricing, and they kill their golden goose," Scott said.
US producers have painful memories of the boom-bust of 2006-07, when an output surge sent prices for Powder River Basin (PRB) coal from US$20 to less than US$10 a short ton and Central Appalachian coal from US$65 to less than US$40. It was the latest disappointment in 30 years of mostly declining prices.
Read more at REUTERS
COAL ... after 30 years of low returns, "can't wait and wants more profits" and is holding off on production and exploration until Environmental, safety are lowered and more subsidies are given
COAL ... after 30 years of low returns, "can't wait and wants more profits" and is holding off on production and exploration until Environmental, safety are lowered and more subsidies are given