Great, simple summary of Peak Oil & how it has manifested. #PeakOil #FT
Great, simple summary of Peak Oil & how it has manifested. #PeakOil #FT
From JH Kunstler's interesting & entertaining (& gently doomerist) 2015 forecasts (a good read).
His summary here on Oil is really good. 'Conventional oil' peaked around 2005 & since then we've been in the 'undulating plateaux' of production & cost/price fluctuations.
_"Despite the triumphal agitprop of the past few years, peak oil is for real. It just manifests more strangely than most people thought, namely, the simpleminded idea that it would only show up as ever-rising prices. No, I made point in The Long Emergency (2005) — and other commentators did too — that peak oil would manifest as volatility. And so since the actual moment of peak conventional crude around 2005, we’ve seen pretty wild oscillations in the price of oil. This is due to the harsh reality that the price people and enterprises can afford to pay for increasingly harder-to-get oil is less than the price that makes it possible to get it. This sets up a yo-yo-ing instability in economic performance that exacerbates even normal wave patterns in the business cycle (which are, in turn, aggravated by banks and governments’ interventions such as ZIRP to suppress those cycles). Below $70-a-barrel the producers go broke; above $70-a-barrel the customers go broke. So the price wobbles up and down as financial Ponzis like shale oil are introduced onto the scene in the hope that debt finagling and mineral rights leasing scams can substitute for physics and geological reality. One trouble with this is that each violent oscillation generates more economic and financial destruction. Activities like motoring, aviation, manufacturing, and retail are badly affected and the entire financial system is made more fragile by worsening increments. Most importantly, the cost structure of the oil industry itself gets battered to a degree that fewer companies can survive to produce the remaining oil.
The big story for 2014 was the crash of oil prices. It is yet being celebrated in other blogger’s 2015 forecasts as a boon to America. Wait until they find out that almost all of the “good jobs” added in recent years were associated with the shale drilling industry that is now being put out of business by low oil prices. Wait until they find out how the failure of junk bond financing thunders through the bond markets and the savage wilderness of derivatives — and ultimately into their ruined pension funds. Wait until they discover that it was but a symptom of the compressive deflationary depression now gripping the entire techno-industrialized world."_
http://kunstler.com/other-stuff/forecast-2015/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed:+clusterfucknation+(Clusterfuck+Nation)
From JH Kunstler's interesting & entertaining (& gently doomerist) 2015 forecasts (a good read).
His summary here on Oil is really good. 'Conventional oil' peaked around 2005 & since then we've been in the 'undulating plateaux' of production & cost/price fluctuations.
_"Despite the triumphal agitprop of the past few years, peak oil is for real. It just manifests more strangely than most people thought, namely, the simpleminded idea that it would only show up as ever-rising prices. No, I made point in The Long Emergency (2005) — and other commentators did too — that peak oil would manifest as volatility. And so since the actual moment of peak conventional crude around 2005, we’ve seen pretty wild oscillations in the price of oil. This is due to the harsh reality that the price people and enterprises can afford to pay for increasingly harder-to-get oil is less than the price that makes it possible to get it. This sets up a yo-yo-ing instability in economic performance that exacerbates even normal wave patterns in the business cycle (which are, in turn, aggravated by banks and governments’ interventions such as ZIRP to suppress those cycles). Below $70-a-barrel the producers go broke; above $70-a-barrel the customers go broke. So the price wobbles up and down as financial Ponzis like shale oil are introduced onto the scene in the hope that debt finagling and mineral rights leasing scams can substitute for physics and geological reality. One trouble with this is that each violent oscillation generates more economic and financial destruction. Activities like motoring, aviation, manufacturing, and retail are badly affected and the entire financial system is made more fragile by worsening increments. Most importantly, the cost structure of the oil industry itself gets battered to a degree that fewer companies can survive to produce the remaining oil.
The big story for 2014 was the crash of oil prices. It is yet being celebrated in other blogger’s 2015 forecasts as a boon to America. Wait until they find out that almost all of the “good jobs” added in recent years were associated with the shale drilling industry that is now being put out of business by low oil prices. Wait until they find out how the failure of junk bond financing thunders through the bond markets and the savage wilderness of derivatives — and ultimately into their ruined pension funds. Wait until they discover that it was but a symptom of the compressive deflationary depression now gripping the entire techno-industrialized world."_
http://kunstler.com/other-stuff/forecast-2015/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed:+clusterfucknation+(Clusterfuck+Nation)
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