Heinberg Claims Middle East Turmoil Could Create Economic Disaster
From Mike's piece on how our oil addiction is Gaddafi's best friend to my own musings on whether the West should help oil states kick the oil habit too, the incredible events in the Middle East have caused a lot of reflection on the political and economic consequences of our excessive fossil fuel use. Now peak oil author and expert Richard Heinberg, who has been exploring his ideas around the end of economic growth of late, has spoken out on what he believes the Middle East situation means for the onset of peak oil. It ain't pretty. In an interview over at Transition Culture, Heinberg sets out how political turmoil is exacerbating peak oil related price fluctuation, arguing that it is making an already complex situation that much more volatile:
"We're seeing high prices now that are not just a result of extra Chinese demand but are a result of revolutions in Libya and potentially in Bahrain and Saudi Arabia. If that continues, we could see oil prices going through the ceiling - we could see $150 again, even $200 and of course that would immediately cause the economy to crash and then we'd see how far oil prices would fall in that case. They might not fall as much this time if global oil supplies are really seriously constrained. Remember in 2008, there hadn't been a decline in oil production that caused prices to fall - it was merely a fall in demand. This time we would see a fall in demand but it would be in the context of supply problems, which could be a different situation all together. It could be much worse."
yet more motivation—as if we needed it—to start weaning ourselves off the black gold, and fast...