All indications are that the second half of 2009 saw oil prices continue to rise and many experts believe triple-digit prices per barrel will once again be the norm. Oil futures on the New York Mercantile Exchange have risen more than 50% since early 2009. Higher gas prices should prompt experts to predict that the American public will jump back on the green energy band wagon.
Surprisingly, financial gurus speculate that rising oil prices may not be the boon for green businesses that many people expected.
First, prices are likely to continue to rise as China’s economy becomes increasingly hungry for oil, fueled by massive government stimulus measures. That means oil supplies are unlikely to be able to keep up with the crushing demand as China ramps up its manufacturing activity to an unprecedented degree. Add to that the fact that US oil inventories have fallen steadily and it has been a long and difficult 2009 for US consumers.
Why isn’t all good news for green energy companies?
A big part of the problem is stinginess on the part of lenders and venture capitalists, who wait nervously to see how the anticipated oil crisis will unfold. That means the green tech companies most in need of capital will also have to wait. There may be money available for the strongest green tech firms, but economic uncertainties will likely be a difficult time for smaller companies, and especially startups, meaning that some of the brightest ideas will not be available to help. to America to weather the newest oil. storm.
To the credit of the United States, oil demand stabilized in 2009, but analysts predict that higher oil prices could slow the fragile recovery process of the US economy. That will set off a ripple effect that can further damage America’s recovery as investors turn away from green energy startups … and startups of all kinds as the country’s future prospects turn. more fragile.
However, the future of green technology still looks promising in the long term. As oil and gas prices continue to rise, the world’s mindset will inevitably change, eventually making green energy the first choice in a wide variety of applications rather than the poor stepchild that has been considered for decades. Over time, expensive oil will lead to its demise as a fuel source.
The problem for green companies is not the future … it is staying in business while they wait for the world to catch up.