It was a late night for me watching election coverage so I’m taking a break on posting about the economy and your investments today.

But, as a heads up, the energy story has shifted from crude to natural gas.

Natural gas is up 63% for the year- a far bigger gain than what crude, which is allegedly a bubble, has tacked on so far this year.

(As an aside, if crude is a “bubble” because of its rise- then what is natural gas? A mega-bubble?)

There are real supply and demand issues with natural gas and prices continue to move higher.

What this means for consumers is higher gas bills to pay for that air conditioning all summer.

How can you invest in it?

The crude explorers are also natural gas explorers. The exploration companies will get double the gifts from Santa this quarter. As an investor, this kind of earnings scenario is very attractive.

And watch the weather. We have entered into hurricane season. Any kind of weather threat in the Gulf of Mexico will certainly push up crude, but also natural gas, prices.

Could we see a big surge of truck drivers heading to Mexico for cheap diesel?

Diesel is even more expensive than regular unleaded gasoline right now. There is a supply shortage worldwide in diesel.

But in Mexico, where the government subsidizes diesel fuel, the price is at least 50% cheaper than in the United States.

CBS Evening News recently talked to one truck transportation business owner who decided to drive three hours from Phoenix to Mexico just to buy diesel:

When Angelo learned that diesel in Mexico is half the Arizona price, he built a large tank to fit into his truck.

“So 11 inches of the bed have been retrofitted to be a fuel tank?” Doane said.

“To be a fuel tank for the truck,” Angelo said.

And headed south nearly three hours just to fill up.

After they crossed the border into Mexico … diesel in Nogales was selling for about $2 a gallon. The Mexican government owns the stations and controls the prices.

“This is quite a trip,” Doane said. “Is it worth it?”

“For 200 gallons,” Angelo said. “Yeah, just saved myself $400.”

But getting back over the border is stressful, with hours of questions, paperwork, and taxes to pay.

“It feels like I’m smuggling marijuana back into the states and I’m just bringing diesel back,” Angelo said.

This business owner, who has run his trucking company for 40 years, believes that the sky-high gas prices may put him out of business. He has already run through a chunk of his savings as fuel costs have soared.

But how many can do what he did? Going across the border is a pain- as he relates. It’s not like you’re driving from Illinois to Indiana to fill up (which many Chicagoans have done over the years as gasoline in Indiana has historically been cheaper than on the Illinois side.)

As he indicated- there are taxes to be paid, papers to be filled out and border officials to talk to.

Many countries are subsidizing the energy costs- including China- in order to give an edge to its businesses and curb inflationary pressures.

But it tells you how desperate some business owners are. Their margins are completely crushed by energy costs. Some will not survive. Others will try and pass along the energy increases to their customers.

That means we all will pay more for our goods.

How far would you go to save money on fuel?

That is the quote from the CFO of small energy exploration company Cimarex (XEC) during their first quarter conference call earlier this month.

He was talking mainly about the profits the company is going to make in the second quarter and beyond, after reporting a record profit in the first quarter, based on $110 to $120 a barrel oil.

Prices averaged about $95 a barrel for the explorers in the first quarter.

Natural gas has also spiked sharply higher.

It’s Christmas in the springtime for the explorers.

Big Oil is being dragged up to Capitol Hill, again, to “explain” its record profits, all the while the small explorers are laughing all the way to the bank. Apache (APA) has made $1 billion in profit each of the last two quarters. That’s pure cash flow.

It will end sometime, of course, as crude oil prices pull back. But in the meantime, it’s nice to be Cimarex.

“You ain’t seen nothing yet.”

Indeed.

The CEO of British Airways was on CNBC this morning talking about the new terminal they’re building for $30 million at JFK. It will be state of the art- where they’ll be able to “pamper” their most affluent travelers.

He was asked about oil prices and what that meant for ticket prices and he didn’t mince words.

Ticket prices will be going up.

How much?

British Airways hedges about 85% of its fuel costs. And even with the hedging, their fuel costs will rise from $4 billion to $6 billion this year. What’s a company to do except raise prices sharply.

Many of them are also going to cut routes because flying the planes are unprofitable. So if you live in, say, Des Moines or Rapid City, you’ll pay even more for fares because there will be far fewer planes serving those routes.

I just looked up a round trip ticket from San Francisco to Newark on United Airlines for mid-July. It’s priced at $414 round trip. That’s not bad at all. That’s what you would have paid a year or two ago (that’s a non-stop flight in the middle of the day.)

But to go from Portland, Oregon to Newark, which is a less serviced airport than San Francisco, it will cost you $665 on United (there might be another airline that would be cheaper.)

Remember when you could just fly somewhere for the weekend for $200? Those days will soon be gone. It might cost you $400 or $450 now.

For a family of five to fly, it could cost over $2000 just for the tickets alone.

Return of the road trip?

We may see more families and vacationers turning to the mini-van, even WITH the high gasoline prices. Local resorts could benefit. Las Vegas and other destinations, where you would normally fly to, are already feeling the pinch.

It’s only going to get more expensive.

The era of “cheap” air fares is over.