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Peak Oil

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FWIW.....

 

Government Agency Warns Global Oil Industry Is on the Brink of a Meltdown

We are not running out of oil, but it's becoming uneconomical to exploit it—another reason we need to move to renewables as quickly as possible.

https://www.vice.com/en_us/article/8848g5/government-agency-warns-global-oil-industry-is-on-the-brink-of-a-meltdown

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"Life is 10% what happens to you and 90% how you respond." -- Coach Lou Holtz

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"I'm done with fossil fuels ... they're just done," [CNBC Mad Money host Jim Cramer] said then. "You're seeing divestiture by a lot of different funds. It's going to be a parade. It's going to be a parade that says, 'Look, these are tobacco and we're not going to own them.'"

 

Cramer said Monday he has taken heat for his stance in recent days, but he was not backing down from it.

 

Fossil fuel stocks, he said, "feel like a slowly melting ice cube, a wasting asset that will have down revenues unless the price of crude jumps and stays higher."

https://www.cnbc.com/2020/02/03/jim-cramer-the-profit-in-oil-and-gas-stocks-is-drying-up.html

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4 hours ago, KJP said:

FWIW.....

 

Government Agency Warns Global Oil Industry Is on the Brink of a Meltdown

We are not running out of oil, but it's becoming uneconomical to exploit it—another reason we need to move to renewables as quickly as possible.

https://www.vice.com/en_us/article/8848g5/government-agency-warns-global-oil-industry-is-on-the-brink-of-a-meltdown

 

I was just about to post this...

 

 

 

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From that article:

 

The current economic system cannot sustain oil prices above $100 a barrel and keep growing, while producers for most new fields cannot sustain profits at prices as low as $45 a barrel without more borrowing.

 

According to Dr. Michaux, the global economy is therefore caught between a rock and a hard place. “Oil prices will be held low for a time,” he explained. “The problem is all consumers at all scales in all sectors are saturated with debt. Costs are going up, while the ability to generate wealth is contracting.”

 

This doesn't seem like an unsolvable quandary, assuming these numbers are correct (and they look reasonable enough that I'll assume they are for the sake of argument, though I'm no oil industry expert).  That still leaves a $55 range between $45/barrel and $100/barrel in which there is room for the companies to have sustainable profits without sparking another Great Recession.  I'm sure that the $2.11/gallon gasoline I saw at the pump last week flows from unsustainably low oil prices and people shouldn't bet on seeing prices like that for the next decade.  But that doesn't mean that it needs to get back to $4/gal in order for the industry to survive.

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^I’m not sure whether you think that is high or low.  In the Cleveland area it ranges from $1.06 to $2.39 for gas.  It’ll be sub 1.00 in a week. 

Edited by audidave

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