Posts Tagged ‘price of oil’

The rise and fall and rise of oil prices

December 21, 2014
gs-oil

Click to enlarge.

Source: Business Insider.

This chart, made by Goldman Sachs and reprinted by Business Insider, which I found on a Naked Capitalism link, shows the rise and fall and rise and (very probably) the impending fall of the price of oil on world markets.

It’s partly an example of the law of supply and demand in action.  When the price of something goes up, people use less of it, look for ways to produce more of it, and invent substitutes for it, and eventually that brings the price back down again.

But I think it shows something else, and that is the end of easy-to-get oil.  Hydraulic fracturing, deep water ocean drilling and Arctic drilling will increase the supply of oil over time, but oil will never be available as easily or as cheaply as from the historic oil fields in Texas and the Persian Gulf.

I don’t think oil will ever again be as cheap as it was during the years from 1880 to 1970—at least not for long.   And that’s probably a good thing in the long run.   So long as oil and other fossil fuels are cheap, we’ll keep on making new greenhouse gasses and burn up the planet.

The passing scene: Links & comments 11/17/14

November 17, 2014

What really happened in Beijing: Putin, Obama, Xi—and the back story the media won’t tell you by Patrick Smith for Salon.

Patrick Smith explained why the real winner in the new U.S.-Russian cold war is China.

Saudi Arabia is driving down the world price of oil, now about $80 a barrel, by putting oil on the market.  The main point, Smith wrote, is that the Saudis can make a profit so long as oil is priced at more than $30 a barrel, but the Russians, whose oil is harder to get, need a price of $104 a barrel.

The Saudis oppose Russia for supporting Syria and Iran, which are obstacles to Saudi influence in the Middle East.  Other oil-producing nations suffer collateral damage.  Venezuela is currently going through a political and economic crisis due to the fall in the price of oil.

Russia had helped the United States in its negotiations with Iran, by agreeing to reprocess uranium for the Iranians, which would remove the possibility that the reprocessing might be used to make Iranian nuclear weapons.  U.S.-Iranian negotiations also are collateral damage.

All this benefits China, which gets to buy Russian oil and gas at a bargain price.  China is expanding its influence in Asia offering attractive trade deals to nations that don’t want to be drawn into U.S. conflicts.

Ronald Reagan’s secret tragedy: How 70s and 80s cynicism poisoned Democrats and America, an interview of Rick Perlstein by Thomas Frank for Salon.

Rick Perlstein, author of the newly-published The Invisible Bridge: the Fall of Nixon and the Rise of Reagan, said the roots of present-day politics go back to the 1970s, when President Richard Nixon governed based on short-term political gain, and candidate Ronald Reagan encouraged Americans to believe in the myths we tell ourselves.

Democrats meanwhile turned away from working people and New Deal liberalism and embraced an illusory non-partisanship.  This created a politics in which big-business conservatives can pose as  populists and the true representatives of working people.

Act of Faith: the Catholic priest who puts his life on the line to save Muslims in the Central African Republic by Sam Jones for The Guardian.

Father Bernard Kinvi is a true hero who lives up to the best teaching of his church.  His story is well worth knowing.