“How about an update on those wild energy stocks?” Michael Monday writes. “How long can the party last?”

That party is the spectacular run in energy shares of more than 100% over the past three years and a percentage sprint this year in the low to mid-20s.

For some thoughts, I rang up one of the best energy minds around, the $100 million man Alan Gaines, and one of the country’s more successful investment advisers, Martin Weiss.

The timing could not be more propitious for this editorial exercise, as brokerages are increasing their downgrades of individual names both in the oil and oil services sectors, largely on the grounds that the stock prices are running ahead of the fundamentals.

Messrs. Gaines and Weiss both think that’s the wrong way to go and say that while you can’t jump into these stocks willy-nilly anymore, the energy party is far from over.

Mr. Gaines, a former crack institutional energy analyst, a one-time adviser to Carl Icahn in his hostile energy takeover attempts, and no stranger to this column because of his consistent stock-picking prowess, reckons that if you equate energy shares to the human life cycle, the stock group is probably only in its 20s.

Energy fundamentals remain very positive, he notes. “It’s Economics 101; you’ve got growing demand and diminishing supply,” Mr. Gaines says. “American production is not being replaced. We, as well as China and India, have an insatiable oil appetite. America still doesn’t have a viable energy policy, and given current conditions, the terror and supply disruption premium of about $15 a barrel is not about to disappear any time soon.”

In recent years, we’ve seen forecasts of $100-a-barrel oil from the likes of Goldman Sachs, Merrill Lynch, and Boone Pickens. Mr. Gaines, currently CEO of Dune Energy, a Houston-based oil and gas producer, figures that the elusive triple-digit target is likely to become a reality over the next 12 months. Oil closed Friday at around $73.93 a barrel.

Given the surge in energy stocks, Mr. Gaines, who is said to have a personal equities portfolio in excess of $100 million, about 90% of which is in the energy sector, has easily been one of the best stockpickers in this column. Three of his current favorites, each of which he owns, are Allis-Chalmers Energy, Chesapeake Energy, and Comstock Resources. He views all three as potential 25% to 50% gainers over the next 12 months.

Mr. Weiss, who runs Weiss Research in Jupiter, Fla., doesn’t see any change in the fundamentals that have driven oil prices higher, especially as they relate to international turmoil. As such, he thinks $80- to $90-a-barrel oil is a good possibility in the next few months, with the price climbing to $100 by year end.

Assessing major overseas concerns, he views Venezuela, which has the largest petroleum reserves in the Western Hemisphere, as “a basket case in the making” whose oil industry has been turned upside down by its firebrand dictator, Hugo Chavez. Indicative of this is Venezuela’s seizure of the control of four foreign-owned oil ventures, with two of the biggies, ConocoPhillips and Exxon Mobil, announcing plans to pull out of the country altogether.

Another ticking time bomb, Mr. Weiss says, is the world’s fourth-biggest oil exporter, Iran, which he feels can blow at any time, as it’s inching toward a broad conflict with America over Iraq. Yet another big risk is one of the world’s largest sources of light crude oil, Nigeria. One-fifth of Nigeria’s oil production is currently shut down due to military protests, attacks, and sabotage. As much as one-fifth of the output is thought to be vulnerable to future attacks, Mr. Weiss points out, and nearly all of Nigeria’s production could come to a standstill in a civil war.

Next is Iraq, which owns some of the world’s largest oil reserves and is in chaos. Despite the biggest oil industry rescue effort of all time, Iraq’s oil exports are still stuck below the 1.7 million barrels a day exported under Saddam Hussein. And in the event of a political collapse, Mr. Weiss observes, even that level would be tough to maintain.

Adding to the energy woes, he says, is the fact that we’re in the midst of the fuel-guzzling summer driving season, the unwillingness of Americans to cut back on their energy consumption, and the shortage of refining capacity.

Mr. Weiss’s best energy bets are energy alternative plays, namely ethanol through Archer Daniels Midland and the Brazilian national oil company, Petróleo Brasileiro, and nuclear power via Canadian-based Cameco Corp., one of the world’s largest uranium companies. Transocean and Baker Hughes are some other favorites.

The bottom line: For now, the bull market in energy looks like it just won’t quit.

dandordan@aol.com