Tuesday
07Oct2008
AND NOW, THE GOOD ECONOMIC NEWS...
Tuesday, October 7, 2008 at 08:55AM The wily Donald Trump has been saying it for some time now but one big plus to the current banking chaos is the concomitant drop in the global price of oil - now under $89! Crude prices have now dropped from $147 in mid-July and I believe that the price will drop closer to $70 in the next few months as demand further depresses and even OPEC will struggle to keep prices high. The impact of soaring oil on the fundamentals of our global economy cannot be sufficiently exaggerated and so this significant fall - all but ignored by the media - may lead to much better economic prospects in the medium-term. All we need to do now is... drill, baby, drill.
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Reader Comments (13)
Two points:
1. The price is falling because we are entering a global economic recession which will depress demand for at least two years.
2. Drilling becomes less economic as the price of the commodity falls and demand declines. So oil companies will cut back on drilling new fields.
Drilling provides better access to non-OPEC sources. Wwe drill.
True, but the oil companies look on it purely as an investment decision. Unless you nationalise Exxon in the name of national security.
They look upon it as a long term investment and the prospects look fine. All that has been lacking is Governmental support and should McCain-Palin get in, drilling will commence. Of course under The One we will get lots of hot air, no action, more and more reliance on the oil of our enemies.
Drilling is a temporary solution.
David
Oil companies do not look at long term investments they are strictly a short term reward operation
Add to this that they have calculated carefully exactly how high the price of oil needs to be to make any project viable they will not drill holes for the sake of drilling holes.
They will gladly sit back and reap the profits of being an oil reseller if thats where the easy profits are
drilling our own oil is the only solution Mahons you feel its better to send 700billion dollars a year out of the country is better than keeping it here?
Sean that is the most ridiculas statement ever made on this site,
Oil companies are the longest looking companies that exist. Thats why they have aquired major controlling shares in coal, solar, wind, bio and nuclear fuel industries
all but ignored by the media
Oil IS the economy.
Drilling is a temporary solution.
Drilling is no solution. To keep up with global demand a new Saudi Arabia needs to be found every four or six years years. That hasnt really happened since they last found Saudi Arabia.
Why? Because there is not only growth in demand but growth in depletion also.
Oh and dont be fooled by the likes of Trolls solutions like Alaska. They dont have billions of barrels of oil, they have mountains of Shale Oil deposits. Shale oil isnt even liquid, its a rock formation and requires tremendous amounts of energy (Natural Gas) and in the end only creates a synthetic oil substitute.
If drilling can be done in an environmentally responsible manner, it should be done. Period.
Money to the treasury, jobs to the workers, a lessening of imports, however small.
It is a no brainer of all time.
Money to the treasury, jobs to the workers, a lessening of imports, however small.
It is a no brainer of all time.
I agree, but good luck changing the status quo. The incumbents will protect their incredible position of power, to the death if need be.
we need a governmental purge....
I like the idea of a purge.