His $30 is closer to the real price once speculative quotient is removed. Oil reached normal demand prices when the large "investment" banks teetered on the brink of bankruptcy and other smaller banks went bust. the climb back up in oil prices then coincided perfectly with the tax payer bailout of the remaining 2 banks.
In the 1950s Shell Oil geologist M. King Hubbert predicted peak oil production for the lower 48 states occurring in the late 60s to early 1970s. Indeed, he was correct. See the chart I posted in an earlier post. From that it is not exactly a leap of faith to think that global production wouldn't follow a simialr bell curve. Predicting global production is a lot more difficult however, because nations like Saudi Arabia will not allow audits of their fields. It's a guessing game. Nonetheless, the period between 2005-2008 does show a plateau of oil production. Much can be attributed to the recession - we'll soon see. We may have peaked already.
Peak oil is a very inconvenient theory to capitalists. It is a knife in their side. Capital accumulation via means of production and consumption at current rates cannot continue indefinitely. The party is gonna end sometime, and the economy will have to become more aligned with the Earth's resource reserves. There will either be a gradual transition with much bemoan to a slower economy. Or there will be a hard landing, much worse than the oil shocks of the 1970s. This is just simple fact, only the time frame is up for debate.
All of this arguing is pointless in the end. Natural transition away from oil is already happening. Soon enough the energy market will be full of competing ads that resemble the current fight between Cable and Satellite TV. By that I mean that options such as solar, wind, etc will become commonplace to an extent that the price of oil will then have to drop to remain competitive. For some time we will see a mixed market full of both petrol cars and electric cars, and consumers will be forced to choose. But eventually, there will be a migration toward to main energy sources. Solar and Nuclear. Oil will still be around for use, but will only make up a fraction of the global market share. It will also be likely that there will be companies generating fuels via lawn clippings to satisfy the relatively small demand.
Yeah, right... the transition will be seamless. More like resource wars and economic collapses. Here's a good visual of how competing energies stack up to oil. By the way, a cubic mile of oil is roughly what the world consumes in one year. Oil is KING - there is no replacement, no equivalent.
There is a company who has figured out how to make oil identical in molecular structure using some sort of process. My point is they *make* it, not find it. I was reading about this about a year ago, let me see if I can dig up the links. Hopefully, they're still around and not bought up and shut up by a rich oil company.
Didn't say seamless, I said there will be a transition and it will result in a mixed market. The result will be solar and nuclear. It is the only thing that makes sense in the long run. Oil isn't King. PRICE and VALUE are king. The second alternative fuels even start to compete on price, people start looking at them. It is amazing how far solar alone has come during the last year, and also how reasonable price has become. People were once looking at a 20y break-even on outfitting their home with solar. Current projections put that at 5-10 years now. And that is using what are essentially garbage solar panels. They only get about a 25% efficiency. It's only logical to think that tech advancement will allow for at least 50-60% efficiency in the near future, and production costs will only go down relative to incomes.
typical idiotic ET thread. arguing about abiotic origins of oil - whatever. bring me a gallon from jupiter and then i agree the origins of oil start to matter. until then - there are no (easily extractable) giant fields found in the past 20 years. why could it be? of course mankind will figure something out - but they have not found anything yet as cheap as oil is...which is, btw, the reason why we go into wars for it. price will solve the problem of demand - but not so much of supply, a.k.a. the peak oil.
This is also why Oil is KING: Air conditioners, ammonia, anti-histamines, antiseptics, artificial turf, asphalt, aspirin, balloons, bandages, boats, bottles, bras, bubble gum, butane, cameras, candles, car batteries, car bodies, carpet, cassette tapes, caulking, CDs, chewing gum, combs/brushes, computers, contacts, cortisone, crayons, cream, denture adhesives, deodorant, detergents, dice, dishwashing liquid, dresses, dryers, electric blankets, electricianâs tape, fertilizers, fishing lures, fishing rods, floor wax, footballs, glues, glycerin, golf balls, guitar strings, hair, hair coloring, hair curlers, hearing aids, heart valves, heating oil, house paint, ice chests, ink, insect repellent, insulation, jet fuel, life jackets, linoleum, lip balm, lipstick, loudspeakers, medicines, mops, motor oil, motorcycle helmets, movie film, nail polish, oil filters, paddles, paint brushes, paints, parachutes, paraffin, pens, perfumes, petroleum jelly, plastic chairs, plastic cups, plastic forks, plastic wrap, plastics, plywood adhesives, refrigerators, roller-skate wheels, roofing paper, rubber bands, rubber boots, rubber cement, rubbish bags, running shoes, saccharine, seals, shirts (non-cotton), shoe polish, shoes, shower curtains, solvents, solvents, spectacles, stereos, sweaters, table tennis balls, tape recorders, telephones, tennis rackets, thermos, tights, toilet seats, toners, toothpaste, transparencies, transparent tape, TV cabinets, typewriter/computer ribbons, tires, umbrellas, upholstery, vaporizers, vitamin capsules, volleyballs, water pipes, water skis, wax, wax paper (from http://gasprices-usa.com/petroleum_based_products.htm) If oil goes to 150-200 or even more a barrel - then either we find replacements for the above (and man many more) or expect to pay higher prices. It would kill economies until they re-adjusted. Oil is why the earth's population went like this: I have thought of buying an oil fund - USL - but not so sure anymore. My concern is that the price of oil and economic recovery go hand in hand - and thus we will see feedback loops between economic growth and the price of oil. It could get very volatile, and unpredictably so. I don't see oil moving beyond 80 or lower than 65 for quite some time.