In the wake of last year’s oil price collapse we are once again reassured about an overabundance of cheap oil. This could only be a temporary aberration. Below I present the reasons why the prospects are grim and the price of oil is likely to rise multi-fold in the next few years. The consequences for the western societies will be serious.
During the 19 years of my career in commodities I have observed time and again how significant price changes shape the prevailing market narrative. By narrative here I mean a shared interpretation of the way key causal forces affect market events. Market fundamentals – available bits of relevant data and information – are the building blocks that mould our understanding of what’s going on, but what we do with them depends on how we evaluate their relevance and credibility. This is never a straightforward process, so at any one time we can entertain more than one possible interpretation of market conditions. Read the rest of this entry »
The Jubilee 