Re: Will gas be over $20 a gallon by Christmas?

> Obviously oil will eventually run out, and nobody is saying that it
> won't. You seem to be stuck on that one thing. But you seem to
> believe we'll go from pumping 18 million barrels a day or whatever it
> is, to drops overnight.
>
> That's not how it will work. Oil wells will dry up, gradually, in
> which time it will be worthy for investors and companies to develop new
> and better technology which will edge into the market, and consumers
> will evetually, without any cohersion, move to different sources for
> their power. The free market works, and it will work for this too.
>

The problem is that the free market is going to work too slowly. When oil
production drops (permanently) by 10% or more, that will cause worldwide
economic disaster. It will be the same as if the oil dried up overnight.
The results will be EXACTLY the same. We need shitloads of money to build
infrastructure that is non oil-dependent. In the middle of a world-wide
economic crisis, where is that money going to come from?

Free market forces can help turn a viable economy. Free market forces
cannot save an economy that has already collapsed. Having trouble
visualizing this? Then consider the following . . .

Oil production drops 10% (in roughly 2013). At that point, there is near
100% unemployment (not just in the U.S.). Somebody THEN comes up with the
brilliant plan to mass-produce hydrogen powered vehicles (of all types,
commercial, agricultural, and personal) to restart the economy. Now who is
going to finance this plan? Would-be Investors are broke, as they lost
everything in the recent stock market crash. Potential customers are
unemployed (leading any would-be investors to be very wary, in addition to
being very broke).

In short, when the oil production starts slowing down (as it WILL), it is
too late to try to implement a plan "B". Market forces alone will not solve
the problem of the impending oil crisis. If gas prices were to slowly rise,
market forces might help spur competing non-oil-dependent solutions. But we
aren't going to see a SLOW rise in oil prices when production starts falling
off. I wouldn't be surprised at all to see crude oil at $7000 per barrel
before 2014, though it might still be trading below $100 per barrel in
13. -Dave


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