How Converting From Oil to Natural Gas Could Backfire

Natural gas is cheap and plentiful, but will that last long enough for you to recoup a big upfront investment?

Feb 17, 2014 at 1:30PM

Huge discoveries of natural gas reserves sent the price of the clean-burning fuel to their lowest levels in more than a decade last year. But as more homeowners and businesses convert to natural gas, there's a danger that many are ignoring.

In the following video, Dan Caplinger, The Motley Fool's director of investment planning, examines the way that counting on cheap natural gas could backfire. Dan notes that based on current prices, converting from oil-based home heating to natural gas allows you to recoup your big initial investment within just a few years. Indeed, commercial trucking businesses are looking at engine conversions, with Westport Innovations (NASDAQ:WPRT) helping to develop natural-gas engines and Clean Energy Fuels (NASDAQ:CLNE) and General Electric (NYSE:GE) partnering on a network of natural-gas fueling stations around the country. But Dan also goes through some of the reasons why natural gas prices could rise in the future that could make conversion less profitable, including simple increased demand as well as projects to export natural gas. Dan concludes that it's smart to consider plenty of contingencies in making a final choice with a furnace conversion or other natural-gas-based energy solution.

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Dan Caplinger has no position in any stocks mentioned. The Motley Fool recommends Clean Energy Fuels and Westport Innovations and owns shares of General Electric and Westport Innovations. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

Click here to learn about this incredible technology before Buffett stops being scared and starts buying!

David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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