Oil Squeeze

I throw these little comments on the condition of the oil market in from time to time, because it will be impacting us all very seriously. We all have learned that we can handle a $100 fill up. Can we handle a $500 fill up? Hell no! And that is what is coming because the average citizen is about to be forced out of the gasoline market.

It is really very simple. We now have no reasonable way to even maintain current production levels and no amount of investment is going to change that fast enough now. It is already too late. The fact is that past levels of huge sustained investment has failed in keeping pace with demand and that demand has also accelerated.

The only option left is to let prices rise to a level that effectively rations transportation fuel to the highest and best use. %500 a tank should do it. We know that the economy will adjust very quickly, but we also know that we will have to restructure our lives toward a far lower usage of automotive fuel.

The only question now is if it will be slow and easy which is preferred or abrupt which is often ugly.

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