Investors hoping to cash in on black gold might want to gamble on the shiny kind as well.

Bob Howard, a long-time energy bull, thinks so, anyway. Until recently, Howard ignored all the talk about unsustainable energy prices and pushed subscribers of his investment newsletter,

Positive Patterns

, toward stocks like

ChevronTexaco

(CVX) - Get Report

and -- even better -- beaten-down

Royal Dutch/Shell

(SC) - Get Report

.

But he found himself cooling on the sector about the same time the media started treating it as the next hot thing. So when oil prices kept setting new highs last week -- and failed to pull oil stocks up with them -- Howard was far from consumed by the development. He was contemplating the likes of

Placer Dome

( PDG) and

Newmont Mining

(NEM) - Get Report

instead.

"I think the next thing to go up is gold," explained Howard, who doesn't invest in the stocks he covers in his newsletter. "Just look at what happened when oil prices went up in the '70s. Gold followed."

Howard still tells his clients to hold onto their solid energy stocks and maybe even scoop up a little more Shell while it's down. He remains convinced that high energy prices, driven by incredibly tight supplies, are here to stay. Thus, he scoffs at common Wall Street models that rely on $30 oil -- a steep plunge from the near $50 seen last week -- to forecast future earnings. He is convinced that oil prices will "normalize" at a much higher level and, when they do, analysts will be forced to change their models and jack up both their profit estimates and their target prices for the energy stocks they follow.

For now, however, some energy investors are clearly raking in their profits. Stocks like ChevronTexaco,

ConocoPhillips

(COP) - Get Report

and even the industry "gold standard,"

ExxonMobil

(XOM) - Get Report

, have slid from their summer highs even as oil prices have set a series of new records. Howard's clients, like other fortunate investors, plunged into energy well ahead of the crowd and have already enjoyed a huge bull run. Now they are looking for the next big ride, and some plan to board the gold bandwagon.

Moving On Up

Jude Wanniski, a former Reagan adviser who coined the phrase "supply-side economics," has studied the relationship between oil and gold for decades.

He watched their prices first spike during the cycle that Howard -- looking for a repeat -- is now studying anew. He points to America's change in monetary policy, specifically its decision to drop the gold standard in 1971, as a trigger for the volatile commodity prices that followed. He has seen the trend reverse itself, with oil and gas prices plunging, more than once. But he notes a stark difference in the current situation.

Even under America's current monetary policy, he says, an ounce of gold has always tended to buy about 15 barrels of oil. Now, he says, it buys fewer than 10. He believes that a correction is imminent.

"Because gold and oil are now so out of whack, according to traditional relationships, something has got to happen," Wanniski said. "Either gold goes up or oil goes down."

Wanniski isn't necessarily banking on the latter. Unlike Wall Street analysts -- who believe that oil prices will fade along with a so-called security premium caused by worldwide unrest -- Wanniski sees little relief ahead. He says that many energy companies abandoned capital-intensive investments during the last volatile downswing. As a result, he says, they are now capable of producing almost no excess capacity at a time when demand is soaring.

"It is this thin capacity that drives the 'security premium' rather than the threat to security itself," George Yates, former president of the Independent Petroleum Association of America, recently told Wanniski in an interview.

To be sure, Wanniski says, the world has plenty of oil -- including 50 undeveloped fields in Saudi Arabia alone. But oil executives, burned by previous downturns, have grown reluctant to chase those high prices again, he adds.

Wanniski points to testimony from Yates as evidence.

"There is no doubt in his mind that $40 oil would be enough to solve the problem," Wanniski recently wrote, "but that the prodigious amounts of capital and effort needed to develop the necessary capacity will not appear as long as the world energy industry is not sure the price would be maintained."

Wanniski believes that nothing short of a return to the gold standard can bring that security back.

Catching the Wave

For now, however, investors hope to capitalize on the volatility that exists.

John Stann of Stann Financial says his own portfolio remains "disproportionately" weighted in both energy and gold stocks. He, too, views high energy prices as a lasting phenomenon. And he plans to hold on to his energy stocks even if oil prices spiral in the near future.

"I can tell you that the people I respect, the people I read, believe that oil and gas supplies are going to remain a worldwide problem," he explained. "I wouldn't be surprised if oil does go down to $30 a barrel. But I think it will go up in the long run."

Stann also expects that gold could follow. He points out that investors typically buy gold -- and drive its price higher -- when they view the U.S. dollar as vulnerable. And he believes that America's record budget and trade deficits could soon further pressure the currency.

Jim Puplava of

Financial Sense Online worries about an outright financial disaster. And he fears that investors -- except those who have been piling into commodities -- could wind up getting hit hard.

"What we have here is financial alchemy, and I can't help but believe that this is going to end badly," he wrote in mid-June. "There is simply too much risk and uncertainty. What astounds me is the fact that investors seem oblivious to it all."

But investment strategist Peter Cohan suspects that some knowledgeable traders are indeed playing it safe. He believes that industry experts bought energy stocks years ago and then started cashing out -- and driving the stocks down -- when retail investors finally arrived at the party. He notes that individual investors have poured some $2.88 billion into energy funds so far this year. He says the same crowd actually withdrew money from the sector before the run-up started two years ago.

"According to

my theory, there are energy stock traders who are benefiting from the public perception that energy prices are going through the roof and that the public should, therefore, be buying energy stocks," explained Cohan, who owns no stocks in the sector himself. "These stock traders have been selling into the public demand to lock in their profits."

He says that trading energy -- instead of energy stocks -- appears to be the more lucrative sport. Indeed, he says, trading commodities in general seems to be extremely popular right now.

But Cohan would shy away from gold at least. He bought a gold fund himself once. He says he watched it skyrocket, then plunge 2% or 3% a day until he finally cashed out with a small loss and a great dislike for the highly volatile industry.

"There is all this conspiratorial speculation about central banks controlling gold prices," he explained. "And there's no way of really knowing what is going on. That makes me quite nervous as an investor."

Cohan says he better understands the drivers behind oil prices. But he remains troubled that investors seem to be favoring all commodities, including oil, over traditional stocks.

He was particularly alarmed to see a seat on the commodity exchange costing more -- for the first time ever -- than a seat on the Big Board.

"It just happened in the last month or so," he said. "To me, the whole movement into commodities and away from stocks looks really bad. ... It sort of symbolizes the erosion of confidence in our stock market."