Water: the next bubble


Recently I talked to an energy analyst at a major bank about the prospects of water and as a tradable commodity. Fresh water is probably the most vital, but overlooked commodity that will likely see a bubble in coming decades due to increasingly severe shortages, said Robin Bhar at Credit Agricole.

Not only does fresh water feed humanity, but it is also essential in mining for the extraction and on-site processing of natural resources including coal, ores, petroleum and natural gas. Efficient water management will be need to be a top priority, especially for naturally arid climates, such as the Middle East. In November 2006 shortages sparked riots in Saudi Arabia.

China, Saudi Arabia and Algeria, where shortages are acute, have placed billions of dollars of contracts out to tender to improve water supplies for their growing populations.

-Kimiko

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