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Originally Posted by Rolo
Ofcourse the world will need more energy, but that doesn´t automatically mean that oil prices will continue to rise into infinity, because at some point other energy sources will be able to compete and stabilize the "fear" that we are running out of energy.
So if thinking the oil price will continue rise due to fear in the market, then you must also be ready, if that fear never "peaks". If you base your reasoning on numbers of oil peak, then you also got to remember that if the world is facing major difficulties, then normal market forces are put out of play, and replaced with regulation.
The high oil price set by the market is accepted as long the world economy continues to grow...
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Some interesting points. I would counter with...
1) Oil will continue to rise in price until a) there are sufficient alternatives and b) there is not much left that can be efficiently extracted. I would argue it will take a minimum 20 years to develop solar, wind and all the other technologies required to replace oil to the level where they are more than 50%. Today alternative energies are 1%. So you are correct in what you say, but I think we have a long period ahead of us before your first point applies.
2) The only regulation that can replace pricing would be by force. In other words, if the US or China siezed control of certain supplies. Without that oil will continue to be sold to the highest bidder.
3) I disagree that "The high oil price set by the market is accepted as long the world economy continues to grow..." I would turn that statement on it's head and would say that world economies will continue to grow as long as there is affordable oil. Right now oil is cheap as chips. The Europeans pay $7 for gasoline without blinking. So can Americans. In fact $15 for a gallon of gas will still allow industry to progress if we have hybrid cars and only make essential trips.
However, I would say there is one fact that most analysts discount. Oil is *NOT* subject to standard supply and demand economics in the same way as gold and other commodities. This planet has 6 billion people ONLY because of oil. The oil has given the energy to grow food, the fertilisers and pesticides and the energy to farm the food. People NEED to eat.
Therefore people, countries and companies will pay almost ANY price for oil - it will be a matter of survival. Oil is totally unique in this respect. I predict $500/barrel oil within 5-10 years.