What a difference a week makes on schizophrenic Wall Street. Just about every brokerage firm was pounding the table for energy stocks about a week ago. Now, given some recent price weakness in oil – which has skidded to $60.80 a barrel from an August high of $70 – many are lowering their investment ratings on a slew of energy stocks. In the process, a lot of the shares have fallen prey to some recent selling pressure, dropping on average roughly 2% to 5%. In the case of ExxonMobil, its shares have tumbled about 10% from their recent high.

“It could be the energy bubble has burst,” a Chicago day trader, Leonard Marconi, said. “We saw the end of other bubbles, like tulips from Holland in the 17th century [known as Tulip Mania], the nifty 50 buy-’em-at-any-price growth stocks of the late 1960s and early ’70s and the dot-com craze of the late ’90s. And now we may be seeing it in oil.”

Granted, energy stocks, until very recently, acted and looked like a bubble, having ballooned 22.4% in 2003, 28.8% in 2004, and about another 30% so far in 2005. But one dogged energy tracker and investor, Robert Burke, strongly disagrees with the bubble characterization. A veritable unknown to the public at large, Mr. Burke, who has monitored the oil and gas industry for the past 32 years, said, “Maybe there’s a bubble in housing, but surely not in energy.”

Mr. Burke, a planning analyst for the state of Alaska during its oil-pipe building boom and a former policy analyst specializing in energy at the University of California, is convinced that “we remain in a long-term bull market in energy.” He believes the recent weakness in oil is little more than a mini-correction because of its high price and the end of the peak summer driving season. He figures oil could slip to the $55 to $59 range over the next two months, but he views any such decline as temporary, because by December or January he sees a rebound in the price of oil to the 70s, followed by a subsequent rise to the 80s by the end of 2006, coupled with another run in energy stocks.

His projected rebound in the oil price is primarily based on expected winter shortages of both heating oil and natural gas as a result of the hurricanes. About 98% of crude oil and 79% of natural gas from the Gulf Coast is still shut in, he points out. As a result, he sees considerably higher winter prices for heating oil, jet fuel, and gas. He figures gas, now averaging just less than $3 a barrel nationally, will top $4 a barrel by mid-winter. The gulf accounts for 30% of the country’s oil demand and 20% of its natural gas needs.

Recently, Bloomberg TV suggested the weakness in oil could pretty much rule out any rise to $80 a barrel. Mr. Burke thinks this forecast is off-base.His rationale: The easy oil has already been found, meaning drilling in such hostile climates as the arctic and deeper and deeper underwater, is a lot more expensive. He notes, for example, drilling for Alaskan oil is two to three times as expensive as drilling for Texas oil.

Other indicators he cites that the price of oil is headed north over the long run include: its scarcity; growing demand from emerging countries such as China and India as well as from Japan, which is coming out of a deep recession; increasing American and European demand, and the persistent threat of terrorism.

As far as energy stocks go, Mr. Burke, given his favorable oil price outlook, believes “they have nowhere to go but up, at least for the next three years.” As such, he views any weakness as a buying opportunity.

His favorite stock, which he owns personally, is Russia’s Gazprom, the world’s largest gas company. Traded as an American Depository Receipt consisting of 10 common shares of the company and selling at $60, it’s viewed as “very underpriced,” given its enormous reserves. Another Russian favorite is Lukoil, the country’s largest oil company. Also traded as an ADR and 14% owned by Conoco Phillips, it is priced at $57.37 and consists of four of the company’s common shares.

Mr. Burke, who will soon be starting a $500-a-year monthly online report under the name Energy X File, acknowledges that investing in Russia is dangerous, “but it has the goods,” he says. Likewise, he hastens to point out that ExxonMobil, British Petroleum, and ChevronTexaco have invested billions of dollars in Russia.

Additional stock favorites are Occidental Petroleum ($77.26), which has major oil interests in Libya; Shiningbank, ($22.39), a Canadian oil and gas trust; British Petroleum ($65.69), and Conoco Phillips ($61.95).

dandordan@aol.com