Since the beginning of this year, the price for this fuel source has increased by almost 50% — though compared to crude oil, it’s positively cost-efficient and currently accounts for around 40% of the electricity generated in the U.S.

In December of 2005, natural gas reached its peak price of $15 per million BTUs (British Thermal Units). This was due to many factors including unusually high temperatures over that summer and the devastating hurricanes that marked that year.

New record highs for natural gas prices?

Prices are currently around $12 per million BTUs. But this year, a cold winter has already had an impact – reducing inventories by 16% compared to last year.

Adding to this, less LNG (liquid natural gas) imports are anticipated and NOAA, the National Oceanic and Atmospheric Administration, is predicting two to five major hurricanes with Categories of 3 or above this season.

This could mean major profits for investors and there are plenty of potential winning natural gas stocks out there.

My favorite is a small San-Diego-based supplier that is having a banner year…

My natural gas stock choice is Royale Energy Inc.

Royale Energy Inc. is experiencing 52-week highs daily but it still has a long way to go.

Operating as an independent oil and natural gas producer in the U.S., the company owns, operates and leases oil and gas interests in California, Texas, Utah, Oklahoma and Louisiana. It also engages in the developmental and exploratory drilling.

Don’t wait too long to make your move…

In March, the company announced that its oil and gas reserves were up 28% and rumor has it that they are expecting to confirm a significant reserve discovery in the next few weeks.

Happily, Royale Energy is no fly-by-night operation — it’s been around since 1986.

With a market cap of about $59 million this company has the potential — and the room — to grow.

In 2006, Fortune magazine named it one of America’s 100 top fastest growing small public companies – looks like they were right on target.

The stock price has already seen a 69% increase this year so you don’t want to wait to jump onboard for maximum gains.

If your looking for a winning natural gas stock, I recommend you buy shares of Royale Energy Inc. (ROYL:NASDAQ) at or under $9. I’m looking for (at least) a 20% increase in price by January 2009.

Source: Rising Oil Prices Good for Natural Gas Stocks

International oil majors now control a mere 6% of oil and 20% of gas reserves, according to the report. The rest is in the hands of national oil companies.

The unpalatable reality is that national producers such as Venezuela or Russia today have less need of international oil majors to help them develop their untapped reserves.

“There’s an air of panic about the world’s energy-guzzling nations,” says Manraaj Singh

“Russian oil production, the world’s second biggest, has peaked. It may never return to current levels.

“Leonid Fedun, 52, vice-president of Lukoil, Russia’s largest independent oil company, told the FT he believed last year’s Russian oil production of about 10 million barrels per day was the highest he would see “in his lifetime”.

“It’s fueling concerns that the world’s biggest oil producers cannot keep up with rampant Asian demand.

Oil prices are going to keep on rising, says Black Bear of the Secret Order of Jurojin, regardless of who is in control of reserves.

“People have been asking me if it’s too late to buy oil. Heck no, not if you think oil is going to $140 or $150 per barrel this year — and I do. But there’s a better bargain in energy, which I recommended that Secret Order of Jurojin subscribers buy this week: natural gas.”

“You can play natural gas with one of the natural gas ETFs, or with an undervalued natural gas producer. Or, you can go for the leverage of futures and futures options on natural gas. Be sure that any trade fits your risk profile, and run ideas past your investment advisor.”