NEW YORK ( TheStreet) -- This year, for the first time since 1995, the U.S. is anticipated to domestically produce more oil than is imported. As a result of domestic oil production increases, net imports of crude oil are on track to decline to the lowest level in nearly 20 years.
Lower demand for imported oil is exciting news for consumers and for domestic security. I look forward to the day when net imports drop to zero. I believe the time is coming and may arrive sooner than many predict. For the last five years in a row, the U.S. has imported less natural gas than the previous year.
Natural gas producers have recently reversed course and halted operating rigs and/or stopped rigs from coming online as a result of the energy boom shale fracking created.
The slower trajectory by U.S. natural gas producers appear to have paid off. Natural gas prices, as measured by
The US Natural Gas Fund
(UNG), have bounced off a bottom and are unlikely to test the lows soon. Oil may be in a different boat, though.
A price of oil is far from historic lows, and lower U.S. demand for oil is offset by Asian demand. The United States Oil Fund ETF (USO) is trading near $34, but if it declined at the same rate of UNG in the past four years it would trade closer to $7. Unlike natural gas, the relatively higher price of oil provides the needed incentive for domestic producers to continue increasing production. If oil prices fall far enough that may change, but for now U.S. domestic production continues to grow. Intuitively, investors may at first assume that lower U.S. imports would diminish demand for oil tankers and shipping companies. Shipping companies Frontline (FRO), Overseas Shipholding Group (OSGIQ), and Teekay Corporation (TK) have bounced off 2012 lows recently.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV