Civil War in America in 2008?How could this happen again? Lets look at the issue of peak oil. When will peak oil occur?
Some people project that peak oil will occur around 2010, 2030 and beyond...The peak being where the oil production has reached its maximum rate of production. But consider a different definiton of the 'peak' this could be defined as the point where we leave the point of cheap oil
and move into the phase of expensive oil. Now when did this occur?
The price of Oil in 2003 was about $31 a barrel, now in 2004 it was about $44, in 2005 it was $55, $2006 it was about $75. So we if we defined cheap oil being below $30 as set by OPEC then
we can see that we past the peak in 2003 i.e. the point of cheap oil in 2003.
So where will Oil be in 2007? In 2007 I predict it will be $90-$100 in Q1 (Jan-Mar 2007)
and by the end of 2007 it will be $135-150. In 2008 it will be around $182-200.
But what about financial forcasting? What does that tell us about the price?
$44/$31=41% from June 2003 to June2004
$55/44= 25% from June2004 to June 2005
$75/55= 36% from June2005 to June 2006
So if we average (41+25+36)/3=34% per year on average
$75*1.34=$87 from June 2006 to June 2007
$87*1.34=$116 from June 2007 to June 2008
$87*1.34=$156 from June 2008 to June 2009
So some time around 2008 we could see prices in the range of $156? So my prediction are not too far off? But dont forget that commodities do not behave rationally like a linear chart but when in short supply can really explode to the upside like $200 in a matter of weeks.
For example read this
article about what chavez has said about US invading other countries.
Well nothing is for certain but if prices did go to $150-$200 a barrel would this bring about civil war in Amercia?
Imagine that the haulage firms which move food around america went bust when the price hit around $150-$200 a barrel. The people in america would first eat their food in the fridge and then the food in the local shops. Run to get what was left of the oil gas at the pump. Dont forget that oil may not get brought in due to those firms going bust. Once all the food is eaten in the shops people who had stocked up from the shops would become the target of hungry mad max style people. Imagine what happen in New Orleans but multiplied by 52 counties in america - people who have guns and are hungry...attacking the richer counties like a civil war?
People who have more resources vs those with none...law and order could break down in a matter of a few weeks as it did in New Orleans. Even the national guard would be over whelmed and could not cope in this emergency.
We are on the verge of a major crisis in the making...Not to mention the collapse of the banking system which would call on their debt as people started to go bankrupt due to endemic shortages of resources. The financial world is like a domino set ready to set off in a cascading collapse which could happen very quickly due to the wonders of computer technology which would allow banks to sell all their holdings very quickly before the politicans could restore order once panic sets in.
Are we all living on borrowed time? Only time will tell if 2008 is the year to remember...