North American Railroads are some of my favorite stocks in a Peak Oil world. Once a capital intensive low margin business, the sector will have a huge economic moat: High Oil Prices. Not only are they 3-4x as efficient as trucking, their tracks were laid in previous centuries when land was less populated. It will take a lot for any competitor to show up and start laying down new track.
In a relatively distant future the US still has vast coal reserves that can (and will) be tapped. Most coal moved by rail because coal mines are often distant from power plants, and rail is usually the most economical means for moving bulk commodities long distances. Smart bet to own the companies who will be shipping it.
Looking even further into the future passenger rail will inevitably become more important. Here in the US the railroad companies own a lot of track that passenger lines will continue to lease access. Talk about prime real-estate.
Risks: At first, while the transition from trucking to more efficient trains has not finished, they will be very sensitive to Peak Oil’s rolling and frequent recessions. But these drawdowns will provide buying opportunities. They should also shoot off small amounts of dividends that should be reinvested.