Sunday, October 23, 2016

Is There an Economically Sustainable Price for Oil?

Here is a quick hit for you from Chris Martenson and Gail Tverberg.

Some thoughts to ponder while watching the video:
  1. Keep in mind the demand levels and flows are based on an assumption of continuing to "do business as usual" in terms of the civilian transport. How does the equation change if rationing were imposed to limit fuels for civilian transport, while keeping fewer limits on things like fuels used for agriculture or military purposes, say in the wake of a badly managed war that left the US with a restricted ability to import petroleum?
  2. If you disagree with the premise and think a high oil and gasoline/diesel price is sustainable - and thus able to drive the incentives most economists think exist to substitute alternative fuels for transport - how does that play out for the lower 50% of the economy?
  3. If the answer to question 2 is "badly" - how many men and women in that lower tranche of the economy have served in the military and are conversant in urban counter-terrorism operations from their time in Afghanistan or Iraq?
  4. If we take the premise as reasonably accurate, how will your area of the country fare if/when shortages or restrictions on fuels availability affect you?
  5. How fast can local economies shift back towards less-intensive fuel use patterns, say on the order of 1950? Or 1930?
We talked to some of this in Catastrophic Abundance as well. Dust off your scenario planning skills, friends. Methinks time is short.

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