Energy producers may soon notice the decided shift in the wind in Washington, political and otherwise.

After consulting with Congressional Democrats, President-elect Barack Obama moved quickly to double his proposed tax credit for renewable energy in his fiscal stimulus package to $20 billion. The Obama Administration's overall fiscal stimulus package is expected to total about $700-$850 billion.

New 'sheriff' in town

Economist Peter Dawson told BloggingStocks said Obama's energy discussions with Democrats on Capitol Hill display both Washington savvy and a decidedly new energy tone inside the corridors of power.

"First, Obama, so far, is making good on his 'all ideas considered' philosophy. Congressional Dems wanted a renewable energy tax credit program that will help speed the development of solar and wind power, and $20 billion in 2009 will further that goal. So Obama's collaborative decision making process is being deployed," Dawson said

During the past four years, as gasoline first soared above $3, then $4, the United States transferred more than $2 trillion is wealth to oil producing nations, to which OPEC says, "Thank you very much."

However, in recent months, the price of oil has collapsed with the onset of the U.S. and global recessions, and oil now appears destined to test $30 per barrel - - and probably lower levels - - in the year ahead. Oil traded Wednesday down $1.53 to $37.43 per barrel, with regular unleaded gasoline averaging about $1.55-$1.75 nationwide. Incredibly, the stunning turn of events in the oil market means that energy from crude is now 'comfortably priced.'

Still, with three oil shocks (1973-74, 1979-80, 2007-08) having contributed to or directly causing three U.S. recessions, oil's drift back toward 'comfortable' levels re-opens the door for a policy debate: namely, should the U.S. let its economy remain vulnerable to prices swings in this volatile commodity or should it consider a tax to fund alternative energy sources for transportation.

Is a $10 oil tax up ahead?

Economist Peter Dawson said it seems almost unfathomable that the American people and Congress would be willing to ship $100 per barrel (or more) in oil revenue to foreign governments, and not to its own government, but that is precisely the case.

With oil prices cut in half and gasoline near (or below) $2 per gallon, is now a good time for the U.S. to end its century-long addiction to oil?

The topic was raised by none other than the 'liberal bastion' of The Wall Street Journal Monday (subscription required0 with energy analysts and policy makers weighing in.

BloggingStocks Monday asked Energy Trader Jim Dietz to evaluate some of the major recommendations discussed.

• Four-day work week: "It's possible, but the best plan would be voluntary, allowing companies to opt in/out and adopt plans that meet their production needs," Dietz said.

• Mandated higher MPG for vehicles: "This is almost certain to be proposed by President-elect Obama, and will likely pass the Congress. It will reduce gasoline and diesel consumption."

• Mandated flex-fuel cars: "Another measure likely to become federal law and it would take pressure off oil consumption."

• Tax credit for fuel-efficient vehicles: "Another oil saver, and it stands a better than 50% chance of being passed by the next Congress."
  

• Federal funds for next-gen vehicle: "This will likely be included in any rescue package for General Motors, Ford, and Chrysler. A next-generation vehicle would be a game-changer, energy wise, but it's years away."

One wouldn't call it the best week in the world for OPEC.

Once again, the world's best-known cartel has demonstrated that the coalition is not as cohesive or harmonious as a symphony orchestra.

Saudi Arabia, in confidential communications, let it be known that the kingdom would ignore the stated intent of other cartel members and continue to pump plenty of oil, The New York Times reported.

On Wednesday, OPEC announced that members would redouble effort to adhere to production quotas -- not exceed them as some members typically do -- an effort that, if effective, would be tantamount to a roughly 500,000-barrel per day cut in production, The Times reported.

OPEC's hawkish members said lower production is needed to eliminate what it believes is an oversupply in the market, and they cited this as the reason oil's price has fallen about 30% in two months to the $100-range, Bloomberg News reported. Oil closed Friday up 31 cents to $101.18 per barrel.

There are times when you need an archive of information and evidence to make an argument.

Then there are times when one simple fact or incident makes the case by itself. (Which, incidentally, may very well be the genesis of the adage "A picture says a thousand words.")

Evidence item of consequence: a lunch that global trade consultant Edward Goldberg, a colleague of New York Times columnist Thomas Friedman, had with a Russian trade attaché.

The Russian trade attaché, Friedman relates, years ago was delighted to hear from Goldberg that the Bush administration wanted to drill for oil in the Alaskan wilderness. The reason? The amount of oil derived would be negligible in terms of the U.S.'s needs, and it signaled that the Bush Administration was not planning to do anything to establish an alternative energy program, "which of course would threaten the economic growth of Russia."

An oil price of $80 per barrel in 2009?

It's possible, so says a hedge fund firm founder, if the right factors line up.

Renee Haugerud, founder of the $2.5 billion commodities hedge fund firm Galtere Ltd. told Bloomberg News oil may fall to $80 per barrel as supplies of alternative energy sources increase.

Further, Haugerud said the surge in oil has been overdone by investors seeking holdings in raw materials through the Standard & Poor's GSCI Index, a commodity gauge weighted toward energy, Bloomberg News reported. Oil closed Friday down 11 cents to $115.46 per barrel.

Economist Glen Langan told BloggingStocks a further decline in oil to below $100 is consistent with the recent slowdown in global economic growth, but he'll await further international GDP data before arguing for an oil dip to the $80 range.

"The key here, again, as with the uptrend in the previous four years, is China. If oil consumption growth slows in China, oil will experience a large sell-off, as institutional investors and traders sense that the great bull run in commodities is at least pausing," Langan said. "China is likely to register GDP growth of about 10% in Q3, and if it's below 9% or 8.5%, investors will take that as a sign that a slowdown is ahead, which is bearish for commodity prices." China's economy grew 10.2% in Q2 and 10.4% in 1H 2008.

Global oil demand will increase by considerably less than previously expected in 2008, due to the anemic U.S. economy, which is probably already in recession, and slowing global growth, the International Energy Agency announced Friday.

The IEA lowered its per day global oil demand increase by 460,000 barrels, from 1.76 million to 1.3 million barrels - - its biggest cut to a growth forecast in seven years.

Global oil demand for 2008 is now projected to be 87.2 million barrels per day, the IEA said. Meanwhile, global oil supply for March 2008 totaled 87.3 million barrels per day, due to lower supplies last month from OPEC, the North Sea region, and non-OPEC Africa.

General Electric and Vestas Wind Systems are reaping the benefits as U.S. utilities assertively add generating capacity from renewable/alternative energy sources, Bloomberg News reported Wednesday.

For example, XCel Energy (NYSE: XEL), the U.S.'s largest provider of wind power, is buying 67 General Electric (NYSE: GE) turbines for a Minnesota wind farm, and GE expects its turbine sales to increase 25% to $6 billion this year, Bloomberg News reported. GE was the largest supplier of wind turbines in 2007, with a 45% market share. Siemens AG (NYSE: SI) and Vestas are two other major global manufacturers of wind turbines that should continue to benefit as wind power usage increases: each is opening manufacturing plants in the U.S. to accommodate increased wind energy-related sales.

GE's shares gained 89 cents to $34.29, while Siemens AG rose 20 cents to $128.20 in Wednesday afternoon trading.

The oil market, to put it diplomatically, has not provided a great deal of encouragement lately for policy makers attempting to stimulate U.S. economic growth.

Further, time was when an $80 or $85 price would be considered unreasonably high, or even outlandish. But given oil's breakthrough and close above key, psychological resistance of $100 per barrel this week, $80 looks almost like an acceptable price.

Moreover, oil mogul and billionaire T. Boone Pickens says we may get there. Providing a ray of light for concerned business executives, consumers and public officials, Pickens, who accurately predicted oil's rise to $100 per barrel, told CNBC Thursday oil should drop $10-15 in the second quarter of 2008.

"I think oil's going to back off," Pickens said during the interview. "The weakest quarter is the second quarter. We'll drop $10 or $15 a barrel in the second quarter. I think we'll be back above $100 in the second half of the year."

The choppy, consolidating (or perhaps worse) market conditions sometimes give the impression that growth plays do not exist, but that is not the case. One growth company worth reviewing is Energy Conversion Devices (NASDAQ: ENER) . (Please note at the outset that Energy Conversion Devices is only for investors who can tolerate high risk.)

Energy Conversion Devices invents, designs, develops and commercializes materials, products and production processes for the alternative energy generation, energy storage and information technology markets.

Analysts expect F2008 revenue to more than double, with solar capacity increasing to 148 megawatts by the end of F2008, and to 200 megawatts by the end of F2009.

Democrat presidential candidate Sen. Barack Obama, D-Illinois, today unveiled a new $210 billion federal spending plan that he says would create jobs in construction and environmental services.

The Obama proposal would invest money over 10 years in two programs, the largest of which would be a $150 billion effort to create 5 million "green collar" jobs to develop more-environmentally friendly energy sources.

The remaining $60 billion would fund a National Infrastructure Reinvestment Bank to rebuild the nation's highways, bridges, airports and other public facilities. Obama said the construction fund would create nearly 2 million jobs, many of them in construction directly - - a sector hard-hit by the housing sector's correction - - the nation's most severe housing slump in more than 20 years.

Rival Democratic Sen. Hillary Clinton, D-New York, called Obama's effort unoriginal. Neera Tanden, Clinton's policy director, said Obama was offering ideas Clinton proposed months ago. "Voters may ask themselves that if Senator Obama cannot produce his own ideas on the campaign trail, how will he solve new problems as president?" Tanden said in a memo e-mailed to reporters, The Associated Press reported.

Furthermore, the Republican National Committee, which seeks to portray Obama as a tax-and-spend liberal, included Obama's plan on its 'Obama Spend-O-Meter.' The Republicans assert that Obama's announced programs would add $850 billion in federal spending over four years, including health care, education, national service and foreign aid programs, among others. The RNC's web site did not break down the asserted total by year, but economist Steve Affinito told BloggingStocks Wednesday, assuming equal, annual appropriations of $212.5 billion, the total would not be an unreasonable nor an unwarranted outlay, from an economic standpoint, in his interpretation.

"I don't know where the RNC obtained its $850 billion total, but for the sake of argument, even it was $220 billion per year, that's fairly modest, given the services it includes, including universal health insurance," Affinito said. "Also, given the current state of the economy we may find we may need another $150-$200 billion economic stimulus this year, just to keep the economy growing. So in that regard, Sen. Obama's proposal is insinc with the times and a net positive for the U.S. economy."