Does the stock of ethanol prodcuing companies drop if the oil prices increases?

is producing ethanol have anything to do with oil prices...


i saw an analyst once talk about how this company stock might decrease (ethanol producing company) if the prices of oil increase and that got me confused...thank youDoes the stock of ethanol prodcuing companies drop if the oil prices increases?
It's a good question and the answer is, as you would imagine, complex.





It's kind of like playing 3 dimensional chess.





You see, if oil prices increase, inflation increases, which causes interest rates to increase, which causes stock prices to deflate.





However, with oil prices increasing, ethanol stocks should increase because ethanol is a cheaper alternative.





So, when you put it all together, what it tells you is this....the stock of ethanol producing companies should increase as the price of oil increases, but realize that they may not go up as much as you'd like...Does the stock of ethanol prodcuing companies drop if the oil prices increases?
Ethanol is never going to pan out the way you want it to. It's too expensive and inefficient. It takes more energy to create a gallon of ethanol than a gallon of ethanol contains. It's a losing game.





Think about this.....when an ethanol producer ships his juice to a filling station....the truck that hauls it runs on petrol. DUH