longpig wrote:It seems this peakoil thing is a load of crap, Western Canadian Select crude is at $5 a barrel, same price for a bigmac meal. WTI $20 same price as in 2002, when was this site started? what about twilight in the desert, is the oil price lower than when this site started up?
Since OPEC got cranked up re disrupting prices in the 70's, over time, as demand has grown, production has followed. Sometimes technology helped, and (with some delay) higher prices from a supply shortage helped too, when demand got ahead.
So yeah, the incessant braying that we're about to run out of oil just never stands up. Demand doesn't rise every year -- a bad economy will drop it (like happened in 2009), but it has sure risen ALMOST every year. (That may well change when EV's take over much of the global car market, but that could take decades).
Re current prices, there is an apparent LARGE decrease in demand, re COVID-19, which will last as long as social distancing is a widespread thing (and no one can accurately forecast that, at least not yet). Also, there's the whole KSA vs. Russia fight over production. So you've got the market anticipating overproduction AND a significant drop in demand -- so prices collapse, at least for now.
But this is kind of a special case, at least as far as COVID-19, so it's not like there is suddenly a huge unexpected global supply of oil (re new reserves) or anything.
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Two things I've learned re oil prices by observing data / discussion here for over a decade:
1). The price of oil is highly volatile over time. (Don't like it -- it will likely change before very long, and often for reasons few expected).
2). The price of oil is VERY hard to predict ahead of time. We used to have an annual contest and try to pick prices (ranges, timing, etc) for the current year, factoring in the news, etc, every year. Pretty much a random number generator, overall. Fortunes re who was winning and losing would often change wildly from month to month. And year to year.
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FWIW, most of the folks around here have an interest in things like energy, but no longer view peak oil as an urgent thing -- it takes time, but many people will change their mind if the facts are obvious enough -- for long enough. (But certainly not all, and there are still peak oil in-our-face faithful folks around here.
But views are widespread. I joined mainly to learn stuff about oil and energy to help make me a better long term investor.