Stephen Rees's blog

Thoughts about the relationships between transport and the urban area it serves

Gwynne Dyer thinks oil prices could fall

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He takes credit in his latest Straight piece for predicting $120 a barrel oil when no-one else did, so he continues his contrarian ways with the suggestion that economic recession in western countries brought on by the credit crunch will lower demand enough to be reflected in oil prices. Of course, in the longer term they will soon bounce back – and more.

What seems to be missing is any discussion of the instability of many of the places that the world relies on for oil. All it takes is some sabotage in Nigeria or a wave of unrest in some of the former soviet republics and the supply drops rapidly.Similarly, since there is so much dependence on a few very large supplies and a continuing issue with refinery capacity a few hitches – like the damage to Gulf coast installations by Hurricane Katrina – and the present predictions go out of the window.

The rate at which the Chinese and Indians are buying cars will also be a significant replacement for the west finding more efficient ways to get around. I have not worked out the ratio, but I suspect that for every gas guzzler replaced by a Prius or Civic there are several new Chinese cars for households that formerly rode bicycles or scooters. The easing of demand for Chinese products in the US will probably just release capacity for more home consumption or for exports to economies with stronger currencies.

The he returns to the doom and gloom of the impact of climate change – and its effect on political stability in nations at risk. Given that we really ahve not yet tackled the causes of these changes, he is right to do so. There seems still to be a remarkable lack of urgency about effective steps – and the on going saga of BC’s carbon tax seems to be solely about our local issues not the need for tackling the biggest crisis to face mankind.

Written by Stephen Rees

May 2, 2008 at 10:32 am

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