SHOOT: Or in more graphic terms, we'll see an oil shock, or an energy crunch. Our troubles are multiplying now at such a rate that it's becoming easier and easier for us to be sideswiped by something that we're not going to see coming, whether it's pandemic flu, fucked up weather, the lights going off, water or food shortages or just our own populations going berserk as a critical mass of people lose their jobs. Going to be tough to keep our heads when all about us are losing theirs...
RISING oil prices, believes Ali al-Naimi, Saudi Arabia’s oil minister, may soon “take the wheels off an already derailed world economy”. On the face of things, this concern is absurd. The plunge of $115 in the price of oil from its peak last July to its nadir in December was the most precipitous the world has ever seen. Demand for oil is still falling, as the world economy atrophies. Rumours abound of traders hiring tankers to store their excess oil. Rich countries’ stocks cover 62 days’ consumption, the most since 1993 (see chart 1). The average over the past five years has been 52 days’ worth.
The explanation is simple. Oilmen are worried because they believe that many of the factors behind the record-breaking ascent last year remain in place. Much of the world’s “easy” oil has already been extracted, or is in the hands of nationalist governments that will not allow foreigners to exploit it. |
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