http://www.rightsideadvisors.com/public/commentary.go/rsa/commentary/comm-energy/20081104_033440_msg.html/All-Over-But-The-Counting.html

All Over But The Counting

..........Neither candidate has expressed a grasp of peak oil. Other than some campaign sound bites neither candidate is paying attention to the greatest problem we have ever faced. The U.S. and the world is running on cheap oil. We consume 87 million barrels per day and increasing by approximately 1.5 mbpd each year. The time is rapidly approaching where we can no longer continue business as usual. Within months of peak oil's arrival the price of crude will skyrocket again but this time it will be permanent. How is the next president going to deal with a shortfall of 2 mbpd in the USA? That equates to 40 million gallons of gasoline per day that will not be available for consumers. Is that 10 gallons less in your tank or your neighbors tank each week? Everybody always assumes it is the other guys. Unfortunately once the shortage begins after the arrival of peak oil it will NEVER get better. There will be a gasoline shortage for the rest of our lives.

We saw a brief taste of what peak oil will look like when oil spiked to $147 last summer. Gasoline was $4.25 per gallon and there was no real shortage. It was simply a price squeeze brought on by hedgers and speculators. The peak oil shortage will be real and speculators will make it even more difficult to live with. It is going to change your life and that is a fact. You don't have to believe me today because it will still happen. You don't have to believe in gravity but knock your laptop off your desk and it will still break.

Disregard the current "reported" oil glut. It is a very temporary situation brought on by a global recession made worse by high oil prices several months ago. This recession is also a preview of the future. When gasoline prices are $5, $6 or even $8 a gallon the world is going into a steep recessionary spiral that will make today's economic weakness seem like a summer cold. Mark my words today. Before the next president leaves office we will see gasoline well over $5 a gallon and a recession many times worse than we are seeing today. It will not be because they did something wrong. At this late date there is nothing they can do. Our fate is already written in stone as the largest consumer of oil on the planet. We consume 25% of the world's oil but only have 4% of the population. Once peak oil arrives the rest of the world is not going to take kindly to our inordinate share of the worlds dwindling resources. The geological problem will only be made worse by a geopolitical problem of massive proportions as countries demand the U.S. consume less oil so that they can continue to claim their global ration of fossil fuel. It is not going to be a pretty picture and yet the candidates are sparring about who's tax cut will most benefit those on welfare and which is worse a $150,000 wardrobe or a $2 million victory celebration. Neither of the candidates has a clue and voters, most of who don't have a clue themselves, are going to vote for their favorite to bring change to Washington. Change is coming but it is not going to be from Tuesday's winner.