According to the IEA’s World Energy Outlook for 2007:
“An abrupt escalation of oil prices after 2015 as a result of a global supply crisis cannot be ruled out.”
“ . . . it is very uncertain whether new oil production in the period to 2015 will be enough to compensate for the natural falloff in output from existing oil fields and keep pace with the projected increase in demand.”
“The consequences of unfettered growth in world energy demand are alarming.”
Whoa.
I want you to think about something. Oil prices are already approaching $100 a barrel. If the IEA is warning us about an “an abrupt escalation of oil prices,” what exactly does that mean?!
Could it mean $250 a barrel . . . $300 a barrel . . . $480 a barrel?
Yes.
Right now, with oil trading for $95 a barrel, we’re paying the equivalent of 15 cents a cup. There’s 667 cups in every barrel of oil. So $95 divided by 667 = $0.15.
No matter how you spin it or slice it, oil is still insanely cheap. I know that sounds absurd, but it’s true.
