Oh, the beauty of have controls on gasoline. Not. It was announced last night that the price of 95-octane rose by over 8%.

According to Ynet: “The price of octane-95 gasoline is now set at NIS 5.46 ($1.29) per liter, an 8.33% rise compared to March. In Eilat a liter of octane-95 gasoline costs NIS 4.74 ($1.12), an 8.47% rise compared to last month. The gas station service charge will remain unchanged from March, at 13 agorot (3 cents) throughout the country and 11 agorot (2.6 cents) in Eilat. As of February, the price of octane-96 gasoline is no longer supervised, and therefore its maximum price is not included in the ministry report. The ministry recommended consumers compare prices of octane-96 gasoline at different gas stations, since this could lead to a 5% save in gas prices. The increase in gas prices follows the continuing rise in the price of oil. During the month of March the price of a barrel of oil rose by 25%, from $40 a barrel at the start of March to $50 a barrel by the end of the month.”

Funny that while crude oil prices dropped by more than 70% the prices at the pump  dropped a fraction of that. Humm….price controls.. Ughh.

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According to the AAA Daily Fuel Gauge Report, “Average U.S. gasoline prices rang up at $1.84 a gallon on Tuesday, up from $1.67 a gallon a month ago.” That certainly is a far cry from the $4 plus a gallon that we had 7 months ago. Funny how those championing alternative energies have gotten awfully quiet.

What does all this mean? Once again Crude is king and it’s going to be really hard to knock it off the throne.

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As 2008 comes to a close, let’s take a look back at the predictions this pundit made a year ago. Let’s start out with some of my correct calls:

1- At some point during the year the price of crude oil will trade below $75 a barrel. This will be great for the consumer as they save a lot of money at the pump, and will cause a crashing of many alternative energy stocks, especially the Solar plays like First Solar(FSLR).

Nailed that one!

4- Late in the summer the current Israeli government headed by PM Ehud Olmert will fall, and new elections will be called.

Many will say that was a no-brainer.

6- The earth will cool, there will be no global warming.

Just look outside your window.

Now for some of the less accurate predictions:

2- There will be no recession in the US economy, despite the best efforts of the media to “will” one. While the economy should slow somewhat during the first half of ‘08, the economy will grow enough to stay out of a recession, and the second half of ‘08 should bring back 4+% GDP growth.

Oops!

3- The Rudy Giuliani/John McCain ticket will surprisingly win the US presidential election. With Republicans given virtually no chance to hang on to the White House, with a strong economy and the continued  new-found success of the war in Iraq, they not only win but win back control of Congress as well.

So I missed a few on this one.

All in all not too bad. Stay tuned for ‘09 predictions.

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Aaron Katsman is Managing Editor of the Israel Opportunity Investor newsletter. He is lead portfolio manager for the Israel Growth Portfolio and Managing Director of America Israel Investment Associates, LLC. For more information, go to www.israelnewsletter.com or call 1-888-327-6179, or email aaron@profile-financial.com.

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With the Democratic National Convention in full swing, expect much attention focused on alternative energy, Cleantech and environmental issues. After all, House Speaker Pelosi has mentioned that her goal is to save the planet and Al Gore will show up and do his usual speech on how global warming will destroy the planet if we don’t do anything ASAP. I don’t want my cynicism to show through but have the DNC and Obama’s organizers taken any measures to ensure that this convention is environmentally friendly? How much energy is being used to run the event? Just asking.

Anyway, a great article out in the Jpost today about how Israel is on the way to being a world leader in Cleantech. While Shai Agassi’s electric car initiative has gained many headlines around the world, Israel is also very quietly making strong inroads, in solar and water technologies. The article focuses on how Israel is developing the technology for the purpose of letting larger nations do the implementation. Much like the current technological revolution, Israel has been behind many of the advances that have powered us forward. The view is that Cleantech will be Israel’s next boom industry as technologies will be developed that power a move away from crude oil towards alternative energy sources.

The article quotes Isaac Berzin, an expert in using algae to curb greenhouse gases: “Israel should be a world leader - creating the solutions the world is looking for. Investments are coming to Israel [as a result] and lots of jobs are created. Let’s say you develop a major solar technology, which is cost effective etc. What’s the demand for electricity in Israel? A small fraction of world demand. If your only output is Israel then you are in trouble. Hi-tech was great for Israel. Where were the markets? Out there, which is absolutely fine.”

It’s interesting that the one thing Israel lacks is natural resources. The one thing Israel has loads of is brainpower, ingenuity and entrepreneurship. Isn’t it ironic that Israel is using its’ main resource to try and level the economic playing field by developing technology that will greatly lessen the need for natural resources.

Please see our Disclaimer HERE.

Aaron Katsman is Managing Editor of the Israel Opportunity Investor newsletter. He is lead portfolio manager for the Israel Growth Portfolio and Managing Director of America Israel Investment Associates, LLC. For more information, go to www.israelnewsletter.com or call 1-888-327-6179, or email aaron@profile-financial.com.

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