American president George Bush has called for an end to his country's "addiction" to oil, suggesting that alternative energies need to be used to replace the fuel.

In his annual State of the Union speech, the president claimed that the US dependency on oil was a concern because it is "often imported from unstable parts of the world".

He added: "The best way to break this addiction is through technology."

As such, Mr Bush announced a target to reduce American dependency on imported oil by 75 per cent by 2025.

In an effort to reach that goal, the president unveiled an increase in alternative energy funding of 22 per cent, in a bid to encourage greater research, development and use of alternative power sources including ethanol and fuel cells.

"The implication is that we are going to see more federal funding for hydrogen research and that is going to benefit the companies and help them absorb the costs," analyst Brion Tanous from Merriman Curhan & Ford told Reuters.

However, Jeffrey Bencik of Jefferies and Company, suggested that the increase in funding would not help the industry grow in the short-term because it still cannot keep up with demand.

Therefore, it was not surprising that shares in alternative energy companies still fell following Mr Bush's speech, as analysts recognised that the investment would not be enough to change the industry in the short-term.


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