Tuesday, April 17, 2007

I've been looking at some of this energy crisis stuff as of late, where will gas prices be?

Oregon State has a nice graph (others cite higher or lower values for given years, but remain relatively consistent):


Keep in mind the price increases of the 70's were more artificial (political) than the current situation. As of today the problem is with actual supply/demand issues - we are coming close to full capacity.

Nonetheless, I see many arguments that gas was $2 in 1950 (adjusted for inflation). And that's true, but at that time the world's supply of oil was increasing. Now that is not the case.

With prominent people making dire predictions: http://en.wikipedia.org/wiki/Matt_Simmons - look near the bottom at his bet.

Even worse, this guy makes it look like we're, well ... fucked:


While I think that site is overreaching a little, because there are many factors that can delay and soften the blow. Unless it does happen as quickly as it could: prices quadrupling in a matter of weeks (a barrel of oil hitting that $200 mark). The issue isn't the price per se, it's the rapid advance to that price - several weeks.

In the USA, this would destroy many communities that I know. I hear about people all the time that have hour+ communtes, 50 miles one way, etc. Not to mention nasty inflation given that everything from plastics to food. Long story short, this creates lot's of instability. And the big question is how much, it will most probably create a long term recession, or it could go all the way to the dark ages of chaos. Well probably not the latter, except in specific areas.

I'm certainly curious on the specifics of such repercussions. But the usual applies, and you better make sure you have a financial cushion. For my own curiousity I'm going to find more details about this. Many are already available, so research away!

So that's why I've decided to live a bit greener... and with the above in mind, cheaper in the long term. More on this to come...

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