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I read this interesting article the other day and I'm starting to think more and more that it is probably correct. This is especially striking me as more and more probably as oil prices continue to sink lower and lower and OPEC continues to sit on the sidelines as the Saudis pump the market full of cheap oil. $20 oil is the new prediction and the likelihood of it hitting this low seems greater and greater. Let's look at the article quote:The math is clear: there is a fossil fuel bubble. There is more coal and oil in the ground than we can safely burn. In this framing, the Paris climate conference is really an economic conference, perched on the brink of a market crash in the fossil fuel sector. The solution is to leave the fuel in the ground, and set up a price signal to allow a managed retreat from an obsolete industry, and protect the public by sending climate dividends back to households. The concept here is that the worlds elites have realized that we have in essence run out of safe ways to use oil and as a result the drop in prices are a very real response to the realization that the value of oil in the long term future is very small. Since we as a human race can not continue to use it to the extent we have been using it without causing our own extinction the world economic powers have come together to find a solution to negotiate a way out of the global warming crisis and to save their energy industries by transitioning to clean power. The indications here would be that the Saudis have caught on to this before anyone else and are dumping as much oil as they can while they still can so they can invest in future technologies. There seems to be indications that they are already investing heavily in solar, One of the biggest issues this raises is the economic stability of the developing world; much of which relies on oil to prop up their currencies. We are already seeing major devaluation of world currencies throughout South America, Africa, and Asia due to the strong dollar and the collapse of oil values. These countries are not ready to develop renewables in any way or form and as a result could see massive collapses in their economies if oil does reach $20 a barrel or lower. One of the biggest question too would be how the right wing in america reacts once oil completely tanks.
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Dec 10, 2015 06:59
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| # ¿ May 21, 2024 01:44 |
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