You Can’t Produce Your Way Out Of Scarcity…

…in the same way that you can’t exercise your way to better health.

And the idea that you might try to (along with demand dropping at the end of summer) certainly looks like it’s starting to kick in:

Oil prices sank to a five-month low of just more than $105 a barrel on Tuesday as traders turned their sights on signs that slower growth was spreading beyond the US into Europe, Japan and even emerging markets.

The fall led some analysts to suggest that oil prices could move back below $100 a barrel, a level not seen since March, after fears that US oil supplies could be severely disrupted by hurricane Gustav proved unfounded.

Make mine a double.

8 thoughts on “You Can’t Produce Your Way Out Of Scarcity…

  1. And yet Mitch, production didn’t increase at all…

    One wonders why the prices fell – oh, yeah,

    BECAUSE OUR SABRE RATTLING OVER IRAN DIED OFF AFTER THE GEORGIAN INVASION BECAUSE THE WORLD KNOWS WE CANNOT AFFORD TO LOSE RUSSIAN AND IRANIAN OIL – so we sit and appease and hope like hell the rest of the world doesn’t get pissed at us.

    Is that clear enough :).

  2. Just to be clear – yes, there is falling consumption, but that was true 6 months ago as well.. so falling consumption is almost certainly NOT the full or even most important, component of prices falling below $100/bbl. Oil and airline execs both said the key impactors to US prices being above $60 were:

    1. Political/supply interruption possibiliiteis like Iran and Nigeria
    2. Falling US Dollar

  3. I am wondering what form this “appease”-ment took: it isn’t clear. Is a lack of “SABRE RATTLING” appeasement?

    I also wonder, since possible interruptions affected the price, that possible future increases in domestic oil supply had no effect at all on price (in penigma-land).

    Additionally, I can think of few exercises more useless than to “hope like hell the rest of the world doesn’t get pissed at us”. :-/

  4. Actually, peev, it was leaked a few days ago that the Israelis have decided that regardless of what we or the euro-weenies do, they will use military force if necessary to stop the Iranians from developing a nuclear weapon.
    If the facts don’t fit your template, you toss the facts, keep the template.

  5. “hope like hell the rest of the world doesn’t get pissed at us”.

    The only way that isnt the default position is if we submit everything to the UN for approval. I’m good with the world being pissed at us. Soon as they need something, that will (temporarily) go away.

  6. Peev’s plan for a more peaceable world is to keep America’s elected representatives from making American foreign policy decisions.

  7. Pingback: The Twin Cities Daily Liberal » Conservatives on the economy: it’s all in your head

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