A sharp drop in concerns about energy prices pushed investor optimism in August to 74, the highest level in the five previous months, according to the UBS/Gallup index of investor optimism. The level is 21 points higher than a year earlier: it reached a 53-point low in August 2005. Investors who believe energy prices are hurting the investment climate "a lot" dropped from 78% in August to 63% in September. This is the lowest level of investor concern about energy costs since February 2005 when 56% held this view, UBS and Gallop report. About 80% felt this way in October 2005, which is when both oil and natural gas prices were pushed up by Gulf hurricane damage to production and other facilities. This past August, investors expected the average price of a gallon of regular gasoline to reach $3.30 in the next three months; in September, the forecast a much lower $2.76. For more on this, see the November issue of Oil and Gas Investor. For a subscription, call 713-260-6441.

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