Foreword ix
Preface xi
Acknowledgments xv
Part 1: Getting Started in Energy 1
Chapter 1: Energy Basics 3
Oil & Gas Industry 4
Energy Equipment & Services Industry 14
Chapter 2: What Makes Energy Burn: Key Drivers of
the Energy Sector 19
Oil Demand Drivers 20
Oil Supply Drivers 30
Natural Gas Demand Drivers 40
Natural Gas Supply Drivers 45
Additional Drivers 52
Part 2: Next Steps: Energy Details 61
Chapter 3: Energy Sector Breakdown 63
Global Industry Classification Standard (GICS) 64
Global Energy Benchmarks 65
Oil, Gas, & Consumable Fuels Industry 70
Energy Equipment & Services Industry 82
Sub-Industry Drivers 88
Chapter 4: Why We'll Never Run Dry 103
The World Will Never Run Out of Oil 104
The Tipping Point? 109
Peak Oil and You 116
Peak Oil Reading 118
Chapter 5: Staying Current: Tracking Industry
Fundamentals 121
Crude Oil Market Fundamentals 121
Natural Gas Market Fundamentals 131
Refining Margin Fundamentals 136
Energy Equipment & Services Fundamentals 144
Chapter 6: Alternative Energy 151
What Is Alternative Energy? 152
Alternative Energy Drivers 167
Alternative Energy Investment Universe 170
Part 3: Thinking Like a Portfolio Manager 175
Chapter 7: The Top-Down Method 177
Investing Is a Science 177
Einstein's Brain and the Stock Market 178
The Top-Down Method 180
Top-Down Deconstructed 185
Managing Against an Energy Benchmark 193
Chapter 8: Security Analysis 197
Make Your Selection 198
A Five-Step Process 199
Important Questions to Ask 207
Chapter 9: Energize Your Portfolio 217
Strategy 1: Commoditize 218
Strategy 2: Playing Sub-Industries 219
Strategy 3: Company Bets 228
More Sub-Industry Tips 228
Appendix: Energy Sector Resources 233
Notes 236
Glossary 243
About the Authors 249
Index 250
