Peak Oil is Here: Now What?

Dr.

By Shaun Connell:Economists and investors love to argue over the peak oil theory, and what the impact will be for a shrinking high EROEI oil supply means for the global economy.

Bernanke is hell bent on producing price inflation. He has succeeded, just not where he wants most. What Bernanke desperately wants is for housing prices to rise because that more than anything will help the banks and all the foreclosed properties they are sitting on. The Bernanke Fed has certainly assisted the stock market, as intended, but that is not doing the average Joe much good in the face of soaring oil prices, soaring food prices, falling home prices, and zero% interest on savings. Oil Shock Coming

“Peak Oil” is a theory that posits a secular rise in oil prices due to a decrease in global oil production at the same time that global demand is rising. In this essay I will not focus on the question of whether Peak Oil theory has any merit. The problem that I will focus on is the fact that many adherents to Peak Oil ideology have fooled themselves and many others into thinking that oil prices can only go up due to the long-term secular forces that they cite.

In the requests thread, a number of people wanted me to comment on “peak oil.” The main thing I have to say about this is that I don’t totally grasp the alleged significance of reaching a global production peak. It seems to me that to generate the conclusion of big time oil price spikes you only need the assumption that oil production will grow at a persistently slower rate than the world economy.

Does the International Monetary Fund (IMF) believe we have a peak oil problem?

Tim Worstall in The Telegraph:

Gregor Macdonald submits: New Year’s Eve at the end of the decade. A time to play around a little with alcohol and oil, I would think. In the spirit of Dean Martin then, who famously said: I don’t have a drinking problem. I drink, I get drunk, I fall down.