Today, with spot prices near $35/barrel and production more than 80 million barrels a day, overproduction is barely adequate as a description. As new production is brought online, the price of oil will break, and fall below the $10 price of 1998. This, however, will occur only after the price has exceed the $40 level of the past. The impact of this price collapse will make the collapse of Texas oil industry after the overproduction of the late 1920s look like a minor correction. The global deflation will make Japan's ten year stagnation a fond memory.
dms
There are two phenomena at work here, but David only seems aware of one of them. Oil is a commodity just like any other commodity. Due to the irrationality of the market system, there can be periodic gluts of oil just like there was an excess capacity of Japanese real estate. On the other hand, there is such a thing as finite resources under capitalism. Water is one of them. In my opinion, this is an even more apocalyptic prospect than oil depletion. Even among the most optimistic predictions, we are talking about severe oil shortages by the mid-century. I am of the opinion that socialists must adopt the outlook of guardians of future generations. Unless we can project a sustainable future, we will not be taken seriously by ecology-minded scientists. Just as Marx was consumed by the threat of soil sterility (a problem that has never been fully resolved), so must we be engaged with the inter-related problems of global warming, energy supplies and transportation. That is, if we want to be taken seriously.
Louis Proyect Marxism list: www.marxmail.org
