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Strategies & Market Trends : Heinz Blasnik- Views You Can Use
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To: Wyätt Gwyön who wrote (2581)6/24/2003 2:37:44 AM
From: GraceZ  Read Replies (1) of 4907
 
Well if you know the history of petroleum, you know that it's first commercial use was as an alternative to whale oil, which had become extremely expensive and in short supply because of over-whaling in North America and growth in the industrial age. Whaling was a very big business in the US prior to the discovery of petroleum in Pennsylvania. I can assure you that the people then were just as short sighted as you are as to what it was that would replace whale oil. What I can assure you is that it will be replaced and judging from the changes that have occurred in my father-in-law's lifetime it will most likely happen in your lifetime.....especially if your scenario even begins to come true. Its naive to think that demand would grow at the rate that you project if price rises as you think they will. You won't have both.

OPEC figured something similar back when they instituted the embargo. Hubbert reached his peak in popularity back then. Everyone figured we'd run out of oil by 2000 or so. Supply came out of the woodwork at the higher embargo prices, Texas had a big party. It all ended with oil plunging to $10 a barrel with a lot of the people wondering what happened to the severe supply crunch that was suppose to materialize. OPEC learned a lot from that experience. They learned that the only way to keep demand growing is to maintain low prices. Now you say....but it can't go on in perpetuity! The Earth has a finite supply of oil. Yes, it does. As does coal, kerosene, wood, natural gas and whale oil. Long before it brings civilization to its knees, people will switch to something else. Why? Because the only thing keeping us from using something else is the low price of oil.
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