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No, it's a mistake - oil most certainly does not have anything like a fixed supply that is going to run out. The supply grows alongside with the price people a
by lstodd 7y ago
No, it's a mistake - oil most certainly does not have anything like a fixed supply that is going to run out.
The supply grows alongside with the price people are willing to pay for it. As you yourself pointed out.
Nowadays the demand falls, the prices fall, this would be followed by a fall in production. But whatever happens oil will be available at an affordable price because world just doesn't work without it. If oil gets too pricey, reserarch into digging up more oil more cheaply will be funded. As it happened with shale. And it will end up in one more oil price crisis same as the one we're witnessing. And the one after it.
- krapp 7y agoObviously oil has a fixed supply... there is by definition only a finite amount of it, given that we live on a spheroid with a finite volume out of which to extract it. Supply doesn't grow with demand, as that would imply new oil is somehow being created with demand and that, given infinite demand, there would also be infinite supply. What does grow with demand is technological innovation and effort, and while we were not as close to the actual limit as we assumed with "peak oil", that doesn't mean the limit itself was fictional.
- lstodd 7y agoTech, innovation - they are just the other words for "infinite supply". Yes, it is not physically infinite. But it is effectively. As long as someone is willing to pay for it, it will be provided. And even cheaply - look, what's 1970's $12/barrel in nowadays dollars? $50? $100? We are so nowhere near running out of oil, that the whole possibility is best ignored.
- krapp 7y ago>As long as someone is willing to pay for it, it will be provided. And even cheaply This is only true until it isn't. At some point oil will become economically and technologically infeasible and alternatives will win out, because no one wants the million-dollar a barrel oil economy that results when we have to resort to mining Titan for it.
- lstodd 7y ago>At some point oil will become economically and technologically infeasible and alternatives will win out And it will, but I fail to see how this defeats my statement. Oil will become obsolete not because its price will rise, but only because the alternatives will finally become cheaper. Which is not the case as of now.
- auntienomen 7y agoGiven high enough price, we can extract oil from carbon in the air, at least as long as the sun keeps shining.