Exploring Hydrocarbon Depletion
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This morning, the Joint Economic Committee of the U.S. Congress took up the implications of rising world oil demand for the U.S. economy.
The historical experience has been that even very large oil price increases cause relatively little immediate change in the quantity of oil consumed. The response of consumers to energy price increases over 2004-2006 was, if anything, even smaller than those historical estimates. It was not until the price rose substantially over $3 a gallon that we began to see some significant changes on the part of American consumers. Unfortunately, those changes in spending patterns can be quite disruptive for certain key economic sectors and seem to be part of the mechanism by which the earlier oil price shocks had contributed to previous economic recessions.
AAA wrote:My simple overview of the video is:
Oil supplies are tight.
Oil demand will rapidly increase once the economy begins recovery.
Then oil prices will skyrocket.
And the economy will suffer and "complete recovery" will never happen due to high priced oil constraints.
Schmuto wrote:I've been saying this for 2 years at least.
ColossalContrarian wrote:That conference room is eerily empty don't you think?
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