Oil Prices Only Going Up From Here
By George Anderson
If you held out hope that energy prices would be coming down, it’s time to get over that notion.
Guy Caruso, head of the Energy Information Administration, said yesterday that oil prices will remain high ($50 a barrel or higher) because oil producing nations are not investing
in new oil supplies and are unable to keep up with the demand created by nations such as China and the U.S.
As a result, the government expects to see more consumers buying more energy efficient cars and individuals and businesses investing in alternative energy technologies.
Today, reports The Washington Times, the world consumes 87 million barrels of oil a day. Global demand is expected to push that up to more 100 million barrels a day by
2015. Some are now openly questioning whether there are sufficient supplies to meet future demand.
Robert L. Hirsch, an energy consultant with Science Applications International Corp., thinks the situation is already at the critical stage. Mr. Hirsch said the world could reach
its peak oil producing capacity within 20 years and it will take that long to find a replacement.
Last week, he told the House Energy and Commerce Committee, “The economic future of the United States is inextricably linked to Saudi Arabia because they’re the linchpin of future
world oil production.”
“No one outside of Saudi knows how much oil they have in the ground because that’s a closely held state secret. Also, no one outside of Saudi knows how much and how fast the
Saudis will be willing to develop what they have,” he said.
Moderator’s Comment: How will continuing high prices for energy affect consumer behavior and retail business operations in the years ahead?
George Anderson – Moderator