Tickers in this Article: VDE, IXC, PXJ, SU, KOS, PWND, INGXF.PK, BRPFF.PK
Despite the market's recent maelstrom and potential short-term economic slowdown, analyst data and predictions continue to support the notion of higher natural resource prices in the long term. As populations continue to grow and incomes rise in the emerging world, it's almost assured that we'll see overall higher commodities prices across the board. For investors interested in the energy sector, the United States Energy Information Administration's (EIA) latest report helps underscore the long term bullish trend in energy consumption.

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A Big Jump
Now could be a great time for long-term investors to add targeted exposure to the energy sector to their portfolio. The EIA's latest global forecast predicts that the world's energy use will jump nearly 53% by 2035, as strong demand from emerging markets like India and China continues to rise. This 53% rise is more than the 49% increase the agency predicted in last year's report. Overall, total world energy use will grow to 619 quadrillion British thermal units (Btu) by 2020 and 770 quadrillion Btu in 2035, up from 505 quadrillion Btu in 2008.

The EIA believes that fossil fuels will still be the dominate choice for powering our planet by 2035, with oil, natural gas and coal representing 29%, 23% and 27%, respectively, of the world's projected energy pie. The agency does, however, predict a lower average oil price of $108 per barrel in 2020 and $125 per barrel in 2035. The group predicts the growth in Unconventional resources, such as oil sands, extra-heavy oil, biofuels, coal-to-liquids, gas-to-liquids and shale oil to help keep oil prices "low" during this time. The group also predicts that without binding international agreements on greenhouse gas emissions, worldwide coal consumption will also increase, driven by nations within the Association of Southeast Asian Nations (ASEAN). (Learn more in The Industry Handbook: The Oil Services Industry.)

The wild card in the EIA's report is the fate of nuclear and renewable energy. With Japan's recent Fukushima Daiichi disaster still playing itself out, the uncertainties around the growth of nuclear power remain strong. As developed nations like Germany, Switzerland and Italy have already begun plans to phase out, or cancel, their current and future reactors and higher safety costs for new reactors rising exponentially, the group estimates that nuclear energy will only grow by 2% to 7% of the world's energy mix by 2035. In addition, while the group predicts that renewable sources will continue to contribute significantly more to energy production, much of that will come from wind and hydropower. Despite falling prices for panels and installations, solar power will not be major source of power production by 2035. (L1, L2)

Playing The Forecast
For investors, ignoring the markets current noise and adding energy sector holdings for the long term could be a great bet. Exchange-traded funds (ETFs) like the Vanguard Energy ETF (NYSE:VDE) and iShares S&P Global Energy (NYSE:IXC) can be used as a great ways to add a wide swath of energy production to a portfolio. However, there are plenty of targeted ways to play the bullish forecast. (For related reading, see Unearth Profits In Oil Exploration And Production.)

With unconventional oil and gas fields becoming a greater source of worldwide supply, firms that specialize in these plays should continue to benefit. The PowerShares Dynamic Oil & Gas Services (NYSE:PXJ) allows investors to add a wide swath of services stocks that will tap into these deepwater finds. In addition, firms like Suncor Energy (NYSE:SU) and Kosmos Energy (NYSE:KOS), which have hitched their fortunes to places like Canada's Athabasca oil sands and Africa's deepwater are trading discounts to their potential.

For investors wanting to play the renewable side of energy production, wind power can be added via the broad-based PowerShares Global Wind Energy (Nasdaq:PWND) and hydroelectric power can be added via Innergex Renewable (OTCBB:INGXF.PK) which owns 20 hydroelectric plants or Brookfield Renewable (OTCBB:BRPFF.PK) which owns a host of renewable generating assets.

The Bottom Line
Despite the recent slowdown, the long term picture is rosy for the energy markets. The current EIA forecast helps underscore the need for energy firms in an investor's portfolio. Now could be a great time to add funds like the iShares Dow Jones US Energy (NYSE:IYE) for a longer term focus.

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