There is a very interesting graph at The Oil Drum.
It suggests that the price of oil has no influence on world production of oil.
Very, very interesting. And very big implications going forward.
Think about that graph in the link above as you read the commentary by Dave Cohen, November,12, 2009.
I don't accept the "peak theory" as it is currently posited, but I do find these links very interesting.
Using the term 'no influence' doesn't accurately describe what the graphs tell us. It would be more accurate to desctribe it as a small effect. If we look at drilling activity as a function of price we see considerable effect, as witnessed recently in the Bakken. The 'small effect' is telling us something about the degree to which the totality of prime real estate has already been tapped.
ReplyDeleteHess342
Exactly. And I think that's the interesting thing.... "the degree to which the totality ... has already been tapped."
ReplyDeleteAll things being equal, this suggests that price spikes are very possible once "the market" perceives a significantly growing global economy.