Friday, May 3, 2013
A new investigation released by Wall Street Daily just revealed a disturbing pattern of price manipulation in the energy markets.
The six-month investigation, conducted by renowned energy analyst, Karim Rahemtulla, was triggered by the incredible disparity in gas prices between the United States and Europe.
The price of natural gas in the United States is presently about $4/mcf.
Yet the price in Europe is upwards of $15/mcf.
“Such mispricing simply cannot occur in an efficient market,” says Rahemtulla.
For the global economy to function properly, the energy markets must be priced efficiently. It can be no other way.
Any malfeasance can have catastrophic consequences on the global economy. Especially considering the precarious financial positions many world nations find themselves in.
Despite such a reality, though, Rahemtulla discovered insurmountable evidence that natural gas kingpin, Russia, has been artificially manipulating prices.
“It amounts to extortion,” according to Rahemtulla.
You see, Russia controls an enormous share of the natural gas market in Europe.
It’s already regarded as a dangerous monopoly, by most accounts. But what’s particularly troubling is Russia’s increasing abuse of power.
Eighty-percent (80%) of Russian gas flows through Ukraine on the way to Europe.
By virtue of that, Russia can simply kill the gas to Ukraine knowing the move will plunge the entire European Union into darkness, too.
The last time Russia killed the switch was in the dead of winter in 2009.
Since most homes in Europe are heated by natural gas, as you can imagine, new pricing terms were quickly conceded to Gazprom, Russia’s state-owned energy giant.
Now it’s easier to appreciate the enormous price disparity between the United States and Europe.
“The powers-that-be in Washington have turned a blind eye to the extortion for years. But it can’t be ignored any longer,” says Rahemtulla.
“High energy prices alone could be the tipping point that sends the entire European Union into an economic death spiral.”
Burdened with too much debt and a weak dollar, the United States has its own problems. It can’t support the weight of a European collapse without all hell breaking loose on American soil, too.
But thanks to the banking collapse in Cyprus, the energy situation in Europe is now likely to stabilize, without any rioting in the streets.
"Cyprus, in fact, now lies at the center of the energy world," says Rahemtulla.
You see, Cyprus has $400-billion worth of proven natural gas reserves sitting 43 miles off its southeastern coast. It’s enough gas to power the European Union for the next 50 years.
Although a $13.8-billion bailout was just approved, Rahemtulla reports that Cyprus still needs another $7 billion to avoid bankruptcy.
“Expect a deal to be announced between Cyprus and the EU for the right to all that natural gas. The announcement could hit any minute now,” says Rahemtulla.
The deal will save Cyprus from bankruptcy, and also end Russia’s monopoly.
Indeed, Cyprus is now destined to become the largest supplier of natural gas to the European Union. It’ll happen virtually overnight, too.
When the deal between Cyprus and the European Union is inked, shareholders of one particular company are likely to celebrate.
When energy expert, Karim Rahemtulla, began his six-month investigation into Russia’s suspected price manipulation of the natural gas market, he didn’t expect to find a public company buried beneath the headlines.
But that’s exactly what he found.
The company secured the drilling rights to Cyprus’ $400-billion reservoir of natural gas three years ago. Although it’s ready to begin production anyway, the company’s already-enviable position just got even sweeter.
Billions in bailout dollars are now aimed directly at increasing the gas flow. It’s a godsend to the company’s management and shareholders alike.
“The perfect time to buy shares of a resource company is when the production phase begins, which is exactly what’s happening now,” says Rahemtulla. “When Cyprus inks the deal with the EU, though, it’ll be like pouring gasoline on a fire. Share prices will go ballistic.”