The looming oil crisis will dwarf 1973

Commentary: Forces converge to create worldwide woes

By Paul Erdman, CBS.MarketWatch.com

HEALDSBURG, Calif. (CBS.MW) -- As the price of crude oil keeps rising toward $40 a barrel and beyond, it has become increasingly clear that the world is heading toward a major oil crisis -- in terms of both price and supply -- that will dwarf that of 1973.

For many of us who have been observers of global energy trends for what now amounts to decades, this has become not a matter of "if" but rather one of "when." We are facing a convergence of three forces that will have a potentially explosive effect on the market for crude oil.

They are:

1. A growing geopolitical crisis in the Middle East, which is now threatening to spread beyond Iraq to Saudi Arabia, the world's largest producer and exporter of crude oil.

2. A surge in global demand for energy and particularly crude oil and its derivatives, fueled by the recovery of both the American and Japanese economies and the unprecedented growth of China, which has just replaced Japan as the world's second largest consumer of crude oil.

3. A structural deterioration of the world's oil supply. What is involved here is nothing short of an imminent peaking out of production of crude oil on a global basis -- known by energy industry insiders as "Hubbert's Peak" -- which would turn a cyclical supply/demand crisis into a structural energy crisis of unprecedented proportions.


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and it all hinges on the Saudis remaining stable.

And our war in Iraq to ultimately stabilize the area and maintain our power could be the trigger that brings the whole thing down.

profits to be made in such a situation. The oil industry must be drowning in their own spit just thinking of the wealth that will be transferred to them. Oil prifits are off the charts right now, and who do we know in the government closely tied to oil and gas Corporations? Anyone........anyone?

Go google it!

with * to lower prices in time for the election, he probably had his fingers crossed behind his back.

that the 'leaders' of this country have been so stupid that we have wasted more than 30 years on this issue. I clearly remember 1973. We should have started right then developing alternative energy sources. Instead, Nixon, then Ford did nothing. Reagan slashed the alternative energy programs Carter tried to start, and Bush I, of course, would have nothing to do with it. President Clinton tried, and solar and wind power started taking off in the 1990s, and of course, with chimpy taking over, alternative energy is now on the back burner, to put it charitably.

How dumb are American leaders, anyway? We wasted more than 30 years.

...their masters had an agenda for them to enforce, dependence on THEIR OIL!!! I clearly remember Jimmy Carter saying to America that oil was finite and that all of America needed to adopt a clean Earth, preserve-the-resources policy. It was ronnie reagan and his cohorts (coinkydinkly the same black-hearted bastards pulling the strings today) that told us we did not need to save or conserve, that as 'Muricans we were entitled to rape the world and that "it's a new day in America..."



on edit: black to black-hearted. no racial slur intended. simply stating that the evil ones inhabbiting the white house right now don't have a shred of humanity at their core. Evil, black-hearted bastards devoid of anything good, kind or positive.

Belief in the idea that market economies somehow embody knowledge through pricing results in the following logic: Oil is cheap, and since the market-forces must always be right, it must be cheap for a good reason, and so we've got nothing to worry about. QED

Another fallacy of market-based religeon, is linear thinking. Many people who do realize that oil is limited, still believe that it's price will just increase very gradually, and somehow we'll just eventually be gently motivated to figure out some other solution. The idea of a phase-change when demand exceeds supply is just foreign to most people.

A third problem is that Americans don't really get that 2/3 of the world has a standard of living that we would consider poverty, or borderline p overty. A billion Chinese, and another billion Indians, are *just* starting to get a taste of what we would call lower-middle-class lifestyle. The impact on demand for oil will be unbelievable, and most Americans aren't even aware that it's about to happen.