SEARCH BLOG: OIL
Before everyone starts celebrating the return of "the good old days" of cheap gas because oil prices are declining rapidly... declining not low..., there are a couple of issues to resolve:
- political instability remains and may be growing in major oil supply areas... especially with the Russian bombing on Georgia which has a pipeline that supplies over 1 million barrels per day... and has been shut down... plus ongoing potential for an Iranian oil shutoff... plus never-ending conflict in Africa that could be a supply disaster anytime
- politician intractability in the U.S. Democrat party remains a leading cause of failure to expand domestic oil supplies despite knowledge of vast reserves available offshore and in shale... which are imperative even if there is a transition to new fuels and transporation power sources... because oil is used in nearly every product produced for consumption... from fertilizers to plastics... and the transition simply can't happen as fast as these politicians fantasize.
- economic decline is temporary and a partial recovery in the next year will lead to further upward pressure on oil prices
Failure on the part of our politicians to act now will become a bigger crisis on our part in the future.
An interesting comment received from J. Gillman. Check out his link.