Tanada wrote:In my heart of hearts I must admit I think of the $80+/bbl range as 'normal' and the situation of 2015-2017 as the aberration. World oil demand is still growing each and every year and legacy producers are not keeping up in many cases.
Tanada, I agree with your whole post. And this is a perfect example of why it's so hard to predict oil prices in a month or a few years or even a decade.
If prices return to the $100ish new normal, will that accelerate and expand the US oil fracking boom enough to create a glut again in time? Will that make some international oil fracking seen as likely economical to expand that? (In my heart of hearts, I don't buy that the US is the only place oil fracking can be economical to scale. I think it's just a matter of the necessary price of oil to entice producers to take the risk.)
Or prices could get smashed back to $50ish, at least for a while, if sellers smell a short term peak price and dump oil in storage in earnest.
Longer term, barring a big global financial hit that lasts, the rising global demand for oil seems the most likely big trend -- at least for the next decade or so. If prices stay high (say near $100 a barrel) it will be very interesting to see how big the BEV, PHEV, and HEV production numbers can get cranked up in a decade in response.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.