The news from Bloomberg in Saturday were astonishing. This July, the US imported 12% less oil (crude and products) than it had in July, 2013, 9.06 million barrels per day (mbpd). In fact, the imports were the lowest in any July since 1995, according to data from the American Petroleum Institute, an industry body. The reason was the surge in domestic crude production.

In July the US produced at home 8.5 mbpd. That was the highest domestic production in any July in19 years, since 1986. And in the prior 6 months, starting in February, another record was hit: the US produced at least 8 mbpd of oil every day.

These record production highs and record import lows are not because US drivers bought less oil, or cut demand. In fact, oil deliveries rose 1.3% this July from last year, and demand for gasoline was up by nearly as much. The figures signal a shift in “black gold” production for our market away from foreign fields, be they OPEC, Canadian, or Venezuelan, and toward the USA.

This marks major macro-economic and geopolitical changes:

1. US Middle East policy is liberated from the need to maintain the power of Saudi and Persian Gulf autocrats and dictators, the Sultan of Brunei, Siberia, the Caspian Sea coast, Iraq, sub-salt Brazil, Colombia, Venezuela. We still have global interests but they do not include continued dependence on their crude oil;

2. King Coal has been dethroned. This is bad news for Harlan County where the mines are the chief employer. But a sensible Appalachian development program is affordable if government and the private sector together focus on unmet national needs which the region can fill: elder care, education, wildlife conservation, organic food production, back-office staffing, tourism and sports facilities to name a few off the top of my head. The beautiful hills can also be the site of clean new refineries the US needs to process ligher shale crudes. More US refineries east of Appalachia which can deliver to the US Gulf Coast, Atlantic ports, to the Great Lakes are needed to refine lighter shale crude for eastern US demand and to export refined products rather than crude to major deficit markets, starting with Europe. Kentucky is in the sweet spot;

3. Oil companies will explore and drill in new regions of the world with geology similar to our Bakken and other tight oil and shale gas sites: Mexico, Indonesia, Poland, Bulgaria, Britain, Colombia, even Ukraine. It is a brave new world out there;

4. The strong dollar is not a fluke. Lower imports cut the trade deficit sharply, and our normal services surplus count for more. The US June trade deficit in goods (the latest reported) was down $3 bn from the May level of just over $60 bn, a 5% drop. The overall goods and services deficit was $41.5 bn, also down $3 bn because of plummeting petroleum imports;

5. The current US system of taxation and protectionism in oil needs reform if alternative fuels are to gain or retain a foothold. We do not need solar, nuclear, wind, or geothermal power to cut our dependence on imports. We still need them because of the threat of global warming. So the price of low-carbon energy has to be supported.

Toronto analyst Adam Mills wrote up his 10 favorite dividend shares up north. Among them are:

*BCE, the telco branching into TV;

*Bank of Nova Scotia which is big in Latin America, BNS;

and

*Agrium, a diversified fertilizer producer with a sales arm, AGU.

He also tips 3 large caps traded only OTC in the US, which is an area I dislike. Apart from that here are some Mills ideas: TransCanada Corp, pipelines and a bit of solar; Toronto Dominion Bank, TD, which is boosting its brokerage presence in the USA;Suncor, an oil sands operator, and Canadian National Rail, CNI, which we sold over concern about rail freight risks when shipping oil to the USA. If I am right that the US is less dependent on Canada hydrocarbons, the only survivor to consider from Mr. Mills' list is TD. Does any reader use them for brokerage services?

*After a boost in IR and its price, Electrovaya has sunk into the depths, perhaps because its stackable and environmentally-produced lithium ion battery packs are successfully used on Norwegian ferries. Or maybe because it has lost its pink sheet label and you now only can trade it as ELV in Toronto in US$. It is controlled by a Canadian family of Indian heritage and has $2.7 mn in cash thanks to a private placement in June which raised C$2.9 mn. The potential is huge and revenues are going ballistically (by 1400% in its Q3 to June 30, to $2.131 mn from $139) . Gross profit rose ten-fold to $754 but this was only 35% of revenues vs prior year Q3 level of 55%. Apart from ferries, ELV is selling battery systems to China's Dongfeng Motors, for testing in electrical vehicles and to Scottish Southern Power in the UK. It signed upas a registered vendor to an unnamed top 10 retailer and is negotiating with another Fortune 500 major in mining.

ELV's appeal is that it avoids oncogene-toxic chemical n-methyl-2-pyrrolidone in its manufacturing process for lithium batteries. The need to figure out how to store energy from sporadic alternative fuels (solar, wind, hydro) is my reason for sticking with this tiny stock reporting only to Sedar in Canada. This is an illiquid share for the ages, assuming his family continues to back the engineer running it.

*Our other play on lithium, Orocobre, is up sharply again today, currently $2.83 in US trading. It is illiquid being Australian so the market maker cannot unwind trades until Monday. This can boost OROCF up- or downward and today it is upward. It produces lithium and potassium in Argentina.

*Nokia-type Windows smartphones for Microsoft are being produced by Taiwan'sChunghwa Telecom. They sell for NT$18,900, about U$630 and the price includes a royalty to NOK. To reduce confusion with old Nokia phones, MSFT is changing the brand name this Xmas (to an as yet unknown label.) But the royalty fees need to be paid to NOK all the same. As often noted, NOK is buying back its shares almost daily for its employee stock option plan which should boost the price.

*Teva is viewed, wrongly I think, as a potential victim of new US DEA regulations covering prescriptions of potentially addictive hydrocodone combination drugs which will go into effect in 3 mos. This is a minor business for the Israeli generics producer.

TEVA may gain more than expected from the phase III trial it is financing forOncoGenex Pharma's custirsen in treating patients with advanced or metastatic non-small cell lung cancer of 4 types. The outcome of the trials is unknown (it is a double-blind “gold standard” trial) but the interim analysis has led the Independent Data Monitoring Committee to extend the “Enspirit” trial which have gone on for nearly 2 years. If the drug is futile, the trial would have ended. OGXI and Teva also are doing a phase III trial of the drug in metastatic castrate-resistant prostate cancer. With the Israeli market closed on Friday, Teva is relatively illiquid despite being an NYSE stock.

*Hikma Pharma, London- and Dubai-listed, with a pink sheet ADR, HKMPY, is being hurt by unrest in the region where it sells: the Middle East and North Africa. It is also moving into US injectables via a taken over plant in Ohio. Hikma is Jordanian managed and owned. Its shares have been flat all summer long.

Citibank argues that HKMPY is trading at a reasonable 21x 2015 earnings given that it is growing organic sales by ~16% a year. Of course this misses one of the classic GARP metrics where pe is supposed to be below growth rates. But Hikma is also able to finance M&A and up its growth levels. It may also be a tax inversion candidate. Citi has a GBP 20 target price; HKMPY is trading at GBP 17.4 and the ADR at $57.5. It is also illiquid, especially on Fridays.

*Somebody seems to have figured out the meaning of the H1 results of Guangshen Railway, GSH, whose stock fell 3.6% today. Neither Dow Jones nor my broker, E-trade,has any more than I wrote up yesterday. This is an NYSE-listed Chinese share, but it is August.

*Zurich Financial was slashed to neutral from overweight by JP Morgan Cazenove(Britain). The Swiss insurance giant reports on US$ which adds to UK risks but cuts ours. While I cut our stake to normal because I fear that the good 1^st half disaster level may not repeat, I think this is a very good holding for Americans. It is cutting manning levels to boost its ratios and also being more selective in the policies it writes. But this can only go so far if there is a major hurricane or some other disaster. I think ZURVY also builds up reserves Swiss-style to smooth results from year to year.

*Tata Motors was re-rated to buy by Zacks because of a good June quarter, thanks to its Jaguar Landrover sales. The Chicago group raised its EPS estimates for 2014 and 2015 to $4.54 (from $4.32) and $4.99 (from $4.54) respectively. But what got Zacks really excited was the launch of a new car in India, the Zest, 4 years after the flop with the el cheapo Nano. This is a car aiming at India's middle class. So far, while Indian, TTM has been a flop at home. The Jag is produced in Britain and sells (or sold) mostly in China, where I think luxury goods are under political threat.

*My note yesterday about Delek Group negotiating to sell offshore gas to Egypt has been confirmed by the news wires. The sale of $60 bn over 15 years to restore output in Nile Delta gas liquefaction plants by reversing the trans-Sinai pipeline is expected to close by year-end. DGRLY should never be bought on a Friday when Tel Aviv is shut.

*I got into correspondence with an impatient reader over Naibu and China Chaintek, both of which are quoted in London on the Alternative Investment Market, the FTSE AIM, and covered by Daniel Stewart brokerage and Reuters. NBU and CTEK are real companies with properly audited accounts, on up on the stuff brought to Nasdaq by backdoor listings using defunct companies. The brokers cover these shares and help them list (as Nomads under UK rules) because the spreads are huge and profitable, ~6% or more between bid and ask. The AIM is a small and illiquid market and what we are waiting for above all is the move of these shares to the main London Exchange. They have incredibly attractive growth and price-earnings ratios, and are pure buy and hold shares. Be prepared to sit on them forever as trading volumes are tiny and there is no liquidity.

NBU for example earlier this week had a 48 pence bid, and a 51 p ask, and closed at 53 pence a couple of hours later. It opened at 49.5 p. Its market cap is all of £ 29 mn.

I bought more CTEK at 92 p just as the reader was selling at 99 p.

*More illiquidity. Don't trade Benitec, BTEBY of Oz, on a Friday. The marketmaker is on the hook until Monday because he cannot unwrap the US trade Down Under. So the spread widens.

Fund news:

*Our Africa Opportunity Fund, AROFF for ADR buyers, is now on the main London Exchange.

*Also more visible while still on the AIM is Raven Rus, which while still on the AIM, had large volume trades in the wake of the Crimea annexation and is now covered by The Financial Times daily in the London edition. RUS may spin out a REIT.

*Sweden's Investor was rated buy by Citigroup. IVSBF.

*Our two Legg Mason closed-end funds which cut their dividends, EMD and EFD, have finally fallen. The market apparently only looks at CEF prices and net asset value weekly. Ah, the random walk down Wall Street!