As 2015 drew to a close, many in the global energy industry were praying that the price of oil would bounce back from the abyss, restoring the petroleum-centric world of the past half-century. All evidence, however, points to a continuing depression in oil prices in 2016 -- one that may, in fact, stretch into the 2020s and beyond. Given the centrality of oil (and oil revenues) in the global power equation, this is bound to translate into a profound shakeup in the political order, with petroleum-producing states from Saudi Arabia to Russia losing both prominence and geopolitical clout.
A very informative article. Unless China's economy picks up, and the Saudi's cut production (unlikely) , I don't see the situation changing soon.
All commodity prices plummet even as factories produce goods no one is buying.
As example the consumption of steel worldwide is some 500 million tonnes while an estimated 400 million tons in EXCESS of that is produced each year.
China built entire Cities in anticipation of endless growth that are empty of people , this a country that is not an oil exporter. They have even begun demolishing brand new skyscrapers that have never been occupied as a "make work" project.
This extends far beyond oil. There a sea change coming in the worlds economies as there a massive surplus in production of goods worldwide along with a deficit in consumption of the same. The only way out is to increase consumption but this would devastate the ecosystem leading to even more costs and this would mean finding a means to easing consumer debt which would destroy the banking system and mean wealth redistribution which the one percent will not allow.
One of the best Geo-Political articles on oil that been written. Great Job !!!
And this is just the political world of oil production and consumption.
Start adding things like political instability of the status quo and things really start to heat up.
All this combined with the Divestment Group's "Keep it in the Ground" legal strategy, and the great PR Image of the Oil-igarchs (read~Phillip Morris), I'd have to say we are actually witnessing the downward spiral at last.
Technology and price efficiency will only accelerate driving the nail deeper in the coffin.
Everyone remembers being mugged at the gas pump, so there is no love lost.
Blood for Oil has run it course and rightly so.
Haliburton once at near $80 a share is running at $30 and heading down...
Now that IS Sweet Crude.
Agree with other comments: this is the clearest article on the oil price slump and its political repercussions I have read. Thank you Michael Klare & Common Dreams.
But there is a glaring omission: the focus on oil prices and the state of economies is missing the vital component of climate chaos and the costs, disruptions of supply and shipping, and other calamities that (as they escalate in frequency and intensity) will ALSO dynamically alter the overall calculus.
Check this out. This group produces impressive footage EVERY month. To see how intensely the earth changes are already advancing is to recognize that any discussion that speaks of future trends without taking these rising anomalies into account, is missing a vital component in any comprehensive analysis:
Hi Siouxrose, Thanks for your comment: it is certainly right on. The links you sent are appreciated as well. I've watched 10 minutes of the first one and will watch the rest, and if time permits view the SOTT Earth Changes Summary in the future. It seems to me that Klare's purpose in this article was quite limited: He explains why the decrease in oil prices has occurred, what is the prognosis, and what are some resulting national and global effects and what is likely to ensue. It's just one piece of the picture. As you say, there is a larger context here. I greatly appreciate him clearing up my uncertainty about the reason for the depressed oil prices: James K. Galbraith's and others' analysis of a "choke-chain effect" in which economic growth is stymied by rising fuel prices caused by economic growth (if I'm simplifying correctly). The whole idea of GDP as the metric by which to measure a successful society is horribly wrong. It is this perverse valuing of the economy over human well-being which is accountable for a good deal of climate change too. Best regards from copper country, Arizona! Maybe Dr. Klare, who is an expert on diminishing natural resources, will soon write about Rio Tinto's misdeeds at Oak Flat. Here is a link for you that will give some details: http://www.azminingreform.org/content/oak-flat-land-exchange. For latest developments http://www.azminingreform.org/content/senate-version-save-oak-flat-act-introduced.