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https://ourfiniteworld.com/2017/05/05/w ... il-prices/
Great presentation by Gail covering different facets of the Economy including Oil
I summarize with some key points offered by this presentation:
-Both Consumers and Producers important
-Too low or too high oil price is a problem

I should note that not all economists have missed the fact that the pricing situation changes, as limits are reached. Aude Illig and Ian Schindler have recently published a paper that concludes, “We find that price feedback cycles which lead to increased production during the growth phase of oil extraction go into reverse in the contraction phase of oil extraction, speeding decline.

There would be no problem if wages were to rise as oil prices rise. Or if there were an easily substitutable source of cheap energy. The problem becomes an affordability problem.]

-Current oil price appears to represent lack of affordability

-The Waste Outputs lead to falling prices as limited supply nears, and thus lead to a much steeper drop in production than Hubbert’s symmetric model would suggest.

Peak oilers recognized one important point: our use of oil products would at some point have to come to an end. But they did not understand how complex the situation is. Low prices, rather than high, would be the problem

-Our Economy has no option but to grow if it shrinks it collapses

Gail is claiming current oil prices are too low for producers---and she may be right.

But this is a self-correcting problem.

If oil prices are too low for producers then they will reduce or even stop production. IF not, then they will continue producing.

Problem solved.

Its the same for consumers when oil prices get too high. People reduce their consumption of oil or even stop consuming oil entirely when prices get very high.

Obviously this creates temporary problems for consumers when prices are too high and for producers when prices are too low---but in the long run this creates a fluid, dynamic market that matches product to consumer at price both agree upon, albeit with much grumbling and kvetching.



Cheers!

-Our Economy has no option but to grow if it shrinks it collapses

Plant, I doubt you read this entire presentation. It rightly sees PO as a economic/energetic dynamic which will reinforce itself in a downward trend.
The Economy and Oil Industry are going to suck each other like a whirlpool into the drain hole. Read the line I quoted.

The idea that low price of oil is some sort of problem to consumers strikes right to the heart of why the ETP model is hopelessly flawed. As if we need yet another ETP thread when we have three active ones.

this ... presentation.... rightly sees PO as a economic/energetic dynamic which will reinforce itself in a downward trend.

Without data or a concrete example of what you are arguing for, thats just jargon.

In reality, as Cog notes above, most economists say that low oil prices are beneficial to the rest of the economy.

The Economy and Oil Industry are going to suck each other like a whirlpool into the drain hole.

Thats a very colorful metaphor, but again it says nothing about how the economy actually works.

In reality low oil prices are GOOD for the economy. They tend to lower the cost of virtually everything else by minimizing overall transportation, heating, and energy costs.

Cheers!

But what's a "low oil price"?

I would say that the current price of $40 to $55 is too high for the current consumers. So the price may be too high.

And the current prices may also be too low for the current producers, so the oil price may be too low.

All at the same time.

And I can't think of anyway to fix it, as the current producers can't make cheaper oil and the current consumers can't spend more on oil products.

onlooker wrote:https://ourfiniteworld.com/2017/05/05/why-we-should-be-concerned-about-low-oil-prices/
Great presentation by Gail covering different facets of the Economy including Oil
I summarize with some key points offered by this presentation:
-Both Consumers and Producers important
-Too low or too high oil price is a problem

Perhaps you should also mention that she contradicts herself because, well, you know, Gail is a weather vane. Price up? BAD. Price down? BAD. See the point here? Prices don't matter, Gail will just claim the opposite of what she said last time. She can only change when the wind changes direction. Can't predict anything any better than the ETP thing.

Sources matter, and she is a bad one. Oh sure, the gullible looking for a rationalization will fall for it every time, but they are the same folks who would nod vigorously if you claimed that 2+2=5 as long as it was contained within some malthusian doomer porn blog entry.

Reference for those who can't be bothered to attempt to find out the quality of their sources without some help.

Gail on why we NEED cheap oil.

http://www.businessinsider.com/renewabl ... rg-2012-11

You also know that she was part of the Clan Of TOD Peak Oil Call in 2008, right Onlooker? You know, that peak oil that happened nearly 10,000,000 barrels a day ago?

BahamasEd wrote:But what's a "low oil price"?

I would say that the current price of $40 to $55 is too high for the current consumers. So the price may be too high.

1). Why too high, when US consumers are madly buying big expensive SUV's, 300+ HP sports cars (all gas guzzlers, costing $30K+ and often MUCH more), fueling them, and driving them?

2). Why too high when the price was near $100 on average for four years up to 2014, and the US and global economy continued to grow apace?

We're in a GLUT. If anything, the price is so low it is pressuring producers to shut in production and reduce exploration, which may cause a shortage in future years. (The jury is still out on how that scenario unfolds, of course).

...

Invisible unicorns MAY rule the earth, but if you don't give a good reason why they will, don't expect people to buy it.

Cog wrote:The idea that low price of oil is some sort of problem to consumers strikes right to the heart of why the ETP model is hopelessly flawed. As if we need yet another ETP thread when we have three active ones.

With the US GDP at 0.7% YoY, and watching the current situation of the retailer and the automobile industry, I would guess that yes, it's some sort of problem to consumers!

If the economy is like a circus, then Tverberg is the head clown of pop economics.

I wonder if professional doomers, the ones who get paid to predict doom, ever sit back after their doomer predictions come to naught, think about what a waste their life has been. Or do they chuckle about the money they have raked in and proceed on to the next doom prediction as if nothing ever occurred.

For the non-professional doomers, like we have here, a defective memory of past predictions is a very handy resource to have.

I think you guys are parsing doom and realism as the same thing. They are not. I, myself have never uttered specific dates for specific events taking place. I, can ask the same thing about you more optimistic types, why are you here? Sometimes, it seems just to naysay what us more doomerish types contend. I can not speak for others but I am here to flesh out the details of our species trajectory. I find it a intellectually stimulating exercise. None of us can be 100% certain that what we believe will happen will happen. We can at least agree about that

Specific dates are kind of irrelevant to the whole idea of doom. Does it make a difference if human extinction takes place within a hundred years instead of say 2 million years? It is still extinction either way, but on a short time horizon it effects you and your extended family and descendants if any in a way that your mind can grasp.

I read an interesting article by Robert Heinlein about his ability to predict the future, reviewing his expectations from the 1950's in the 1980's. Basically of his 20-30 predictions a few had been proven flat wrong, but the majority if he were selling them would have been a claim of 'just wait and see, we will get there eventually'.

Anyone can predict anything if you keep the event timing vague. For technotopians we could some day invent time machines and come back to prevent our mistakes in the 20th century. For the true doomers Human Extinction will happen some day, if you look far enough in the future. Heck there are species alive today that are indistinguishable from the same species living up too 100 MILLION years ago, like Horseshoe Crabs and Coelacanth fish. However even they will be extinct when the sun runs out of hydrogen a few billion years from now.

Moderates for the most part are more along the lines of tomorrow will resemble today. The challenges may change but the process will remain pretty similar as people tomorrow deal with the difficulties of tomorrow. Even if they meet a really novel problem most of history is about people meeting problems and muddling on through until they either surpass the problem or die.

To be fair you really need to accept the fact that better decisions are made when not everyone agrees.--- I agree with the general tenor of your comment Squil, ideas should be challenged. However, when someone labels you something lets say Doomer, they are NOT honestly challenging your ideas but simply painting all your views under a nomenclature which reflexively they object too. They are fooling themselves if they believe they are truly being objective. We can have disagreements but ideology should not trump objective analysis. It is what any search for valid answers endeavors to do.

onlooker wrote:I, myself have never uttered specific dates for specific events taking place.

You do by extension...by virtue of your virulent support of ETP, which draws a line in the sand of about 4 years hence.

onlooker wrote:when someone labels you something lets say Doomer

People are fair to resort to labels when it seems like the other side's position is purely faith-based and they're not capable or willing to debate the topic on the points.