H 2 Oh no!

It’s been well over two years that I’ve been talking to my readers about the impending oil shortage.

Now, after the market has roundly confirmed my hypothesis, the Saudis are on board, reversing years of party-line posturing, admitting they simply cannot meet supply growth only a few years down the road.

The implications for energy, and oil in particular, are staggering.

And, as a result, our positions in oil and energy stocks have been on fire.

The situation with water is similar.

Although the timeline is different, there’s already a major strain on water systems around the world. So much so, that major international organizations like the UN have made water one of their top priorities.

In fact, it was reported recently that Spain and Portugal are facing one of the worst droughts in history.

So much so, that the governments are draining swimming pools to use the water for drinking.

According to the USA Today this week:

"In Portugal, which was facing its worst drought in 60 years, conditions were described as extreme in half of the country by the national water institute. Wells have run dry in 25 villages, and trucks have been called in to supply 19,000 affected residents.

In Spain, which is suffering one of the driest years on record, reservoirs have shrunk to almost half their normal volume, fields are parched and forest fires pose a growing danger of desertification in the European country most affected by this problem."

Looking further out, water will become an increasingly important, and in many cases, dire situation.

And again, as a result, our water positions will continue to outperform.

It’s why I call the water the growth sector for the next generation. It’s truly a long-term trend.

Yet, unlike oil, it’s a long shot that we’ll see an alternative developed through science.

And so, as a result of an increasing number of people vying for an ever-shrinking portion of available water, I’ve long said that we’ll see water wars develop over this precious resource.

That’s another prediction coming true before our eyes:

NEW DELHI — India and Pakistan have failed to resolve their differences over New Delhi’s plan to build a dam that Pakistan fears will deprive its farmers of vital water supplies.

Work on the Tulbul Navigation project on Wular Lake in the Indian-controlled portion of Kashmir was stopped in 1987 after Pakistan complained that the dam would disrupt the flow of water into the Jhelum River, which flows into Pakistan.

The project is one of eight issues that the nuclear-armed rivals have identified as irritants in their ongoing peace dialogue.

A joint statement issued at the end of two days of talks that ended recently said the two sides would resume the discussions at another round of talks, a date for which would be fixed later.

"The talks were held in a cordial and constructive atmosphere. The two sides exchanged views on the project and reaffirmed their commitment to the Indus Waters Treaty of 1960," the statement said.

Pakistan says the dam violates the Indus water-sharing pact between the two South Asian neighbors and has accused India of planning to store water and control how much would be allowed to flow to Pakistan. India denies the claim.

New Delhi says it wants to build the dam to make a shallow 12-mile stretch of the river navigable during the dry summer months and insists the treaty allows construction to ease navigation.

The talks resulted in a "better understanding" of the issues involved, said Water Secretary J. Hari Narayan, who led the Indian side.

"There has been tangible and good progress," Ashfaq Mahmood, who headed the Pakistani delegation, was quoted as saying by the Press Trust of India news agency.

But an Indian official, speaking on condition of anonymity, said although the talks had gone well, differences persisted, with both sides sticking to their original positions.

Pakistan and India have a history of bitter relations and have fought three wars since independence from Britain in 1947. Both claim the Himalayan region of Kashmir, which is divided between them.

Now, water wars don’t benefit anyone.

But it’s a stark example of the power of the trend that’s been underway for some time now.

And, as with most trends, they tend to stay in motion until some introduced variable negates or reverses them.

– Phantom Trader