A more accurate account of the time series of oil prices is that it depends on the balance of competition versus monopoly control. Thus, prices have spiked during periods when monopolistic control was organized and then have fallen when those systems of control have been undermined by outside competitive forces. Periods of monopoly control include the early Standard Oil period prior to 1911, the period of the Red Line Agreement between 1928 and 1930 before the great East Texas field came in (and the Great Depression collapsed demand), the period of the Texas Railroad Commission domination and high demand from the Korean War in the early 1950s, and, of course the 1970s when OPEC was able to call the shots, that control continuing to some degree until the Saudis in 1986 finally became fed up with the cheating by then warring Iran and Iraq and raised their production (leading to George Bush's pathetic run to Riyadh to save the Houston real estate market). The genie has remained out of the bag since and so it is not surprising that prices have been in a downward trend, albeit with a few blips here and there (e.g. Gulf War), especially now with reduced winter demand (El Nino) in the US and reduced demand in East Asia.
Early on in this debate Mark presented the basic data source on longer term shortage, the recent _Scientific American_ article that projected maximum world production around 2005. Even if it is off by ten years or so due to as yet undiscovered major reserves or major tech breakthroughs in terms of recovery methods out of old fields (these have been happening to some extent), at some point we are going to have to get off oil, one way or another, period. Barkley Rosser On Tue, 19 May 1998 22:22:41 EDT Dhlazare <Dhlazare at aol.com> wrote:
> In a message dated 98-05-18 19:48:31 EDT, you write:
>
> <<
>
> Dhlazare wrote:
>
> > Is this serious? Or have you overdosed on "Mad Max" movies?
> >
>
> Hmmmm. Dan, if Mel Gibson hadn't existed he'd have been invented just to
> console
> you and Jordan for losing an argument. But like all global warming denialists
> and
> energy-entropy denialists, you respond to serious arguments with unconsidered
> jibes. Why is that?
>
> Mark
> >>
> Sorry, just an attempt at levity, didn't mean to be rude. But my point still
> stands -- nature is not going to impose a solution on human society by causing
> energy supplies to run out. Only humanity can impose a solution on humanity.
> Your scenarios about auto traffic grinding to a halt are much too apocalyptic.
> Much more likely, from my point of view, is that, due to excess gasoline
> supplies, we'll all wind up immobilized in some mega-traffic jam on some mega-
> LIE (Long Island Expressway to all you non-Americans), the gas fumes rising,
> the outside temperature hovering at 125 degrees F. due to global warming, and
> some Howard Stern-like shock-jock screaming at us over the car radio for not
> fulfilling our daily consumption quota at the local mall. Shelley thought
> hell resembled 19th-Century London. Brecht thought it resembled the L.A. of
> the 1940s. I think it resembles the Nassau County of the 1990s.
>
> By the way, according to today's NY Times, the price of Saudi Light is approx.
> $12.50 / barrel. This is the equivalent of $3.40 in 1973 dollars, which is
> pretty much where things stood on the eve of the first Arab oil embargo. Once
> again, I insist: the long-term trend in energy prices in a period of chronic
> over-production is downward.
>
> Dan Lazare
-- Rosser Jr, John Barkley rosserjb at jmu.edu