Posted by: Khepera | Saturday, 31 May 2008

Understanding the price of oil — 2.0


In a previous post on this thread, we learned some history — old & contemporary — regarding the *propping up* of the price of oil, to the benefit of the oil cartels, and their corporate hegemony. While we are told we are fighting various wars to “protect our way of life,” we are actually sacrificing the lives and dreams of our unfortunate youth to fatten the already maximally gluteous wallets of epidemic greed. While we are conned into the pugnacious spin of “bringing democracy to the vast unwashed & unenlightened,” we are actually taking the long standing premise of the ‘ugly American’ and inflating it beyond all hope of compensatory balance.

In this lesson, some will discover what many have known for several decades — that the USA has always had a surplus of oil. In some cases it was tagged as “strategic reserves“. In concert with this, some will remember the shutting down of the majority of oil fields in Texas in 1979-80, which sent the southeastern part of the state into a serious economic depression, right on the tail of an unprecedented boom. These sorts of fluctuations in price & economy are clear signs that there is much more at work here than available supply, even when you factor in the relative extraction costs.

If you really want to wrap your head around this — one of the defining factors impacting our ‘quality of life’ in these times — you need to familiarize yourself with the premise/theory of “peak oil”. A great deal has been written about it since M. King Hubbert first used the theory in 1956 to accurately predict that United States oil production would peak between 1965 and 1970(see peak oil & Hubbert peak theory). Keep in mind, these are by no means exhaustive references. Do some study research on your own. The more you read/discover, the more you will realize that this ail situation is one of the great cons in human history.

With the news hype hitting the fan again regarding the Jack2 field in Mexico, the one in Afghanistan, and now the one in North Dakota/Montana (for the actual USGS survey, see the PDF), and others, the peak oil folks have been taking some serious hits for a while. Like most issues, this one has many sides, many advocates, so listening to how the peak oil folks responded is worthwhile.

Clearly, there is much more to this, and this ‘curriculum’ of inquiry/study is, dare we say, a rich field of yet to be determined scope and depth.

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