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Gold/Mining/Energy : Big Dog's Boom Boom Room -- Ignore unavailable to you. Want to Upgrade?

To: Fiscally Conservative who wrote (101895)	6/1/2008 6:18:48 AM
From: elmatador	Respond to of 206323

Difference between the oil price drop 1986 and today environment. 1) Then there was 2.5 billion people out of the world economy. China, USSR (communism) and LATAM debt crisis. 2) Then OPEC could swing prices because it was afraid of alternatives being found for oil. 1) and 2) doesn't exists anymore. Only huge drop in demand can lead to cheaper oil. As 2.5 billion consume more, the fishermen and truckers of Europe feel the pinch. The country that subsidizes fuel idem. Only solution for Europe is cutting dramatically fuel taxes to make the pain bearable. But only for the moment. For the consumption of those 2.5billion will continue unabated. In 5 years, with the gas guzzlers into scrap heap and more (and expensive found) oil coming on stream prices will stabilize. Jury still out for what that price will be. The only infrastructures that are build (need pipelines only) and the technology that is around to relieve pain is sugar cane ethanol.